Tax Refund Anticipation Lending

New Economy Project was one of the first groups to document how banks colluded with storefront tax preparers to make usurious loans backed by people’s tax refunds and Earned Income Tax Credits. Deceptively marketed as “rapid refunds,” tax refund loans siphoned hundreds of millions of dollars from working poor families and their communities until regulators — after years of pressure from advocates — cracked down on this predatory industry.

Rapid Rip-Offs: Tax Refund Anticipation Lending in NYC (January 2010)
A report showing how bank-funded tax refund loans, which carry APRs of 50% – 500%, drained $54.7 million from New York’s working poor families in one year.   The report details the neighborhoods hardest hit, and includes maps showing the millions of dollars in fees that RALs extract from NYC neighborhoods of color.

Predatory Tax-Time Loans Strip $324 Million from NY’s Poorest Communities (January 2007)
A report documenting how RALs extracted $324 million from low income New Yorkers and communities of color, from 2002 through 2005.

Rapid Rip-Offs: Tax Refund Anticipation Lending in NYC (March 2006)
A report exposing how usurious tax refund loan drained more than $92 million of New Yorkers’ income tax refunds and Earned Income Tax Credits, in 2004.