The sign-up fee for H&R Block's Debit Plus is $24.95, but there is no fee for store transactions and users can make one free withdrawal per month from an ATM. After that, there is a $1.50 charge for each withdrawal. There is no monthly fee for four months, but consumers are charged $2.50 a month thereafter to maintain a balance on the card.
Consumer advocates also warn that these cards are not subject to federal rules that insure the funds or limit a consumer's liability to $50 if the card is lost or stolen.
| | | | _____ Tax Center _____  Memorable Changes Many of this year's changes involve minor adjustments. But for taxpayers affected, they can be well worth knowing about.
Numbers Crunch It's clear that taxpayers who don't use professionals to prepare their returns need to have up-to-date guides and/or software.
_____ Featured Columnists _____  A Big Refund Isn't Great Michelle Singletary writes that come tax time, it's better not to receive a refund.
_____ Live Discussion _____ Transcript: Michelle Singletary and Jim Dupree of the IRS
 Special Report: Our coverage includes quick links to advice, federal and state tax forms, a guide to tax law changes that could affect your return this year, and information on getting help. | | | | | | |
|
The Federal Reserve Board and Federal Deposit Insurance Corp. are now considering such rules.
In the meantime, some card issuers voluntarily offer some protections, although the liability may be limited. Visa, for example, limits liability to $50 for all fraudulent transactions on its network, but not for transactions processed on ATMs.
Even so, Visa officials consider the card to be safer than a cashed check. "You have to walk around with cash and could fall prey to criminals . . . and if you lose the cash" there is absolutely no protection, said Nizam Antoo, director of prepaid products for Visa USA.
Antoo said plastic refund cards are "becoming a very big business" because a large number of unbanked consumers are getting large refunds.
And strategically, he added, the cards offer a starting point for banks to encourage the unbanked to open an account or take out loans or credit cards -- "to bring this consumer demographic into the financial mainstream."
Yet plastic also encourages spending, a concern to economists and others who think Americans should be putting at least part of their refunds into savings. "The tax refund is a lump sum that you haven't relied on during the course of a year, so it's a useful and appropriate" amount of money to save, said Michael S. Barr, a University of Michigan law professor who specializes in banking regulations and consumer services.
But having the plastic makes it easy to spend, as Gladys Kemokai, a New Jersey payroll coordinator, discovered.
Kemokai, who had closed her checking account because of the high fees, signed up for the Rush Visa Card to get her $3,600 refund. The money arrived in mid-February. Two weeks later she and her husband used it for a wedding trip to Las Vegas. Only $30 remains on the card. That, she said, she will save "until something bad happens."
