taxmOuth Bites Back at Rapid Refund Ripoffs

LOS ANGELES, CA, January 11, 2011

taxmOuth, the largest tax site on the Internet, announced that the Third Annual National Tax Help Week will focus on ending Rapid Refund Ripoffs. taxmOuth is hosting a week-long series of free events January 10 through 15, 2011 at TaxHelpWeek.com to help taxpayers file their federal and state income tax returns for the 2010 tax year and get thousands of dollars in rapid refunds for free. "This year, we are focusing our efforts on the 8 million people who are most vunerable to being ripped off by Refund Anticipation Loans (RAL), Payday Loans and other qickie refunds schemes offered by many storefront finance shops that offer tax preparation services part-time," says Ronald Bodtcher, Chief taxmOuth.

"Because of the recent IRS crackdown on Refund Anticipation Loans," Bodtcher continues, "many of these storefront shops no longer offer RALs. Instead they have come up with other products that are insanely bad deals for taxpayers. Whether they are called Refund Anticipation Checks (RAC), Electronic Refund Checks (ERC) or Assisted Refunds (AR), these products may require outrageous fees for services that taxpayers can easily obtain for free. At best, the promised refunds arrive in 8 to 15 days, which is no sooner than any normal refund that is available for free. They may arrive much later, or not at all, resulting in interest charges of 100 to 700 percent."

Last year, 35 million people avoided the Rapid Refund Ripoff by preparing and e-filing their own returns. The error rate was less than 1 percent, compared to an error rate of about 20 percent for a paper prepared return. "You can receive a refund in less than 10 days if you use electronic filing and direct deposit," claims Bodtcher. "There's no need to pay the exorbitant refund anticipation loan fees that many storefront tax prep shops charge for a quickie refund."

The taxmOuth FreeFile Center opens January 14, so taxpayers can prepare, print and e-file federal returns for free. "If a part-time or seasonal moonlighting tax preparer in a storefront can do your taxes, so can you--just use taxmOuth's tax web sites, tax toolbars and 'Ask a CPAide' service to help you with any problem areas." Taxpayers with more complex situations need the help of a CPA or other tax professional and can locate a qualified person on taxmOuth's CPAwho.com website. "taxmOuth is committed to providing everything you need to prepare and file your own taxes without undue stress and expense," says Bodtcher. "All of our federal and state tax services are free."

Taxpayers can begin the refund process on January 10 by checking out taxmOuth on Twitter to see if they are entitled to some of the $4 billion in unclaimed refunds offered by the IRS to those who neglected to file returns for the 2007 to 2009 tax years. Many low-income families assumed there was no point in filing returns since they had no tax liability. However, many of them actually can claim prior-year federal tax refunds averaging $1,800 in total, and there is no penalty for filing these late returns. Many taxpayers can also claim state tax refunds. For example, in California, there are nearly 49,000 state tax refunds, ranging from $1 to $218,000, waiting to be claimed by taxpayers for 2009 alone. The average is about $900 in total for the 2007 to 2009 tax years. "This means that many taxpayers can obtain federal and state tax refunds averaging $2,700 right now," Bodtcher says. "Don't wait until after April 15, when the opportunity will be lost forever."

Taxpayers can also begin receiving next year's refund averaging $3,200 by adjusting their withholding and obtaining advance payment of Earned Income Credit. All they need to do is properly fill out and submit Forms W-4 and W-5. "The Form W-5 alone allows qualifying citizens to receive an advance refund for increased cash flow of up to $150 per month," claims Bodtcher. Even without the Advance Earned Income Credit, the average taxpayer can boost cash-flow by $260 every month by adjusting the number of exemptions claimed on Form W-4 so they are not over-withheld by the IRS. "This money can provide investment and spending to help the economy, rather than provide an interest-free loan to the federal government and excess profits to storefront refund anticipation loan shops."

The tax refund process is so simple that it will be explained entirely on Twitter. Taxpayers can visit the taxmOuth Twitter page January 10 and 11 to receive instructions and links to the appropriate forms.

Many of these refunds, credits and other benefits are available from the various states as well as the federal government. Taxpayers can utilize taxmOuth's "State Tax Central" for free assistance in obtaining these amounts. All of taxmOuth's web sites, toolbars, "Ask a CPAide" service and free returns will be available throughout the current income tax filing season until Tax Day, which falls on April 18, 2011. Services for extended returns will be available until October 17, 2011.

About taxmOuth

taxmOuth is the web's largest and most comprehensive web site devoted exclusively to taxes. Founded in 2009 by Ronald Bodtcher, taxmOuth has tax help, forms, tools and FAQs for all countries, federal taxes and the 50 states, including information for each county in the U.S. taxmOuth is headquartered in Southern California. For more information, visit http://www.taxmOuth.com on the web.