Minn. nonprofit warns of tax season scam
As tax season begins, the nonprofit AccountAbility Minnesota is reminding people to beware of predatory tax products.
Filers should be wary of tax preparers offering a product called "refund anticipation checks," said Tracy Fischman, the group's executive director.
"These refund anticipation checks only are temporary bank accounts," she said. "They don't deliver refunds any faster than the IRS can and yet they cost $30 to $35 just for that one piece."
AccountAbility Minnesota also urged families to think of tax time as an opportunity to plan for savings in case of a financial emergency.
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Fischman said many low-income families plan how to spend their tax refund far in advance, often to pay off debt or meet basic needs.
"However, we also know that there may be something that they're spending their money on -- soda, candy -- things that, if they start to think about what they can do with that small amount each day, that it can really add up over time," she said. "It's using those kinds of principles of behavioral economics to urge people and inspire people to believe that the possibilities of the future are bright."
AccountAbility Minnesota helps more than 12,000 low-income taxpayers file for free every year.
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