Should I Choose Direct Deposit for My Tax Refund?

March 23, 2012

Have you always received your tax refund in the form of a check delivered by the US Postal Service? Wondering if there are any advantages to switching to direct deposit? The answer is definitely, “Yes!”

The biggest and most obvious reason for choosing direct deposit for your refund is the fact that you will typically receive your tax refund 7 to 14 days quicker than if you stick with mail delivery of it. But, there are several other benefits that many taxpayers are unaware of.

Refunds that are paid out via direct deposit can be split between two or even three accounts. This can be a real convenience for married couples with separate accounts or for individuals who want to deposit refund money into college savings accounts or other accounts. Direct deposit refunds can also be used to purchase U.S. Series I Savings Bonds! This is a convenient, hassle-free way to save for the future.

There’s also the safety factor. With direct deposit, you never have to worry that your check was lost in the mail. However, you will need to have your correct bank account number and routing number to ensure funds are transferred to your account. It’s also important to note that you must have a U.S. based account for direct deposit. The IRS will not deposit funds into a foreign account.

The IRS publishes a calendar of when they send out direct deposits. To view to this calendar, go to Publication 2043 to find out the likely date of your tax refund.

How to Make the Switch from Check Refund to Direct Deposit
Making the switch from check to direct deposit for your income tax refund is quite easy as long as you haven’t already submitted your return to the IRS. Simply request direct deposit from your tax preparer. There are no additional fees for using direct deposit. Contact Wallace & Associates today for more information about direct deposit of your tax refund.