In a hurry to get your refund? Some tax preparers offer tax refund anticipation loans, often marketed as “rapid refunds” in the form of checks or “gift” debit cards.

The Better Business Bureau (BBB) advises consumers to be wary of these costly loans. They deliver refunds only slightly faster than the IRS.

Refund anticipation loans are similar to payday loans: They’re short-term loans with high interest rates that can range from 50 to 500 percent. In some cases, they have hidden administrative fees. If the tax preparer makes a mistake in calculating your refund, borrowers could be required to pay fines and fees, too.

“Consumers may assume that the loans will be paid off quickly when their refund arrives, but if the refund is less than the loan, consumers will have to repay the difference, plus fees and fines,” said Kim States, BBB president and CEO.

The IRS usually delivers refunds in as few as 10 days after a consumer files a tax return, if the consumer files the return electronically and takes the refund by direct deposit to a bank account. The speed makes most refund loans unnecessary.

This year, the IRS has another option for refunds if a consumer doesn’t have a bank account: a prepaid debit card. The cards, available only by invitation, can be used to get money from ATM machines or to buy goods and services from retailers. The cards arrive faster than checks, the IRS says, and may allow consumers to avoid check-cashing fees.

The BBB advises consumers to be wary of two common tax-time schemes:

Tax reduction schemes are promoted by companies that claim they can help consumers reduce what they owe the IRS by working on their behalf with the IRS. However, the BBB has taken complaints from consumers who paid thousands of dollars to such companies only to find out that the companies didn’t reduce the amount they owed and, in some cases, had never contacted the IRS.

BBB advice: If you have a debt with the IRS, consult an IRS enrolled agent, a certified public accountant or a tax attorney to determine whether you qualify to file for anything other than paying your taxes, fines and penalties in full.

Phishing e-mails may say that there’s an issue with taxpayers’ refunds, that they are being audited or that a problem is delaying processing of their taxes. Many include a link to a website set up by scammers, where victims are asked for Social Security numbers, bank account or credit card (more…)

A year after the collapse of US Fidelis, the nation’s largest seller of extended auto service contracts, the Better Business Bureau advises customers to remain extremely skeptical of any company marketing similar after-market contracts.

“We saw hundreds of complaints in 2010 involving US Fidelis and similar marketing companies. Many people felt they were coerced and manipulated into buying repair plans that had little, if any, value,” said Kim States, BBB President. “While some of these sellers appear to have made progress in reducing their numbers of complaints, many still have a long way to go.”

US Fidelis, the bankrupt Lake St. Louis, Mo., firm, continued to accrue complaints in 2010, with about 400 nationally, including eight in Tucson. Next in number of complaints is NRRM Enterprises, LLC of St. Peters, Mo., better known as Stop Repair Bills or StopRepairBills.com.  More than 200 consumers have filed complaints against Stop Repair Bills since Jan. 1, 2010.  Many claimed they were pressured into buying service contracts they later discovered did not cover their vehicle repairs.

Stop Repair Bills has an “F” grade with the BBB, the lowest possible. Governments in the U.S. and Canada have taken action against Stop Repair Bills and affiliated businesses.

In 2008, then-Missouri Attorney General Jay Nixon sued six companies, including National Dealers Warranty (now Stop Repair Bills), for using “misrepresentation and deception” to sell vehicle service contracts to the public. Five months later, Nixon settled that case with National Dealers Warranty, with the company agreeing to pay about $30,000 in restitution to consumers and for the state’s costs in bringing the lawsuit.

In November 2009, Missouri Attorney General Chris Koster filed a second lawsuit against Stop Repair Bills, accusing the firm, Gilman and other officers of several violations of state law. The case, amended in November 2010, is pending. Allegations include unlawful telephone marketing practices, selling contracts for unregistered providers and administrators, deceptive sales practices, unlawful merchandising practices, unfair trade practices and insurance fraud. Stop Repair Bills sells contracts nationwide.

On its website, Stop Repair Bills says it sells vehicle service contracts for other companies that administer the plans. Marketers like Stop Repair Bills maintain that they only sell the contracts and they should not be held responsible when claims are rejected.

BBB believes that because the marketer enters into the original agreement with the customer and receives payment, the marketer should have ultimate responsibility.

NRRM, which owns Stop Repair Bills, was formed in December 2009 through a consolidation of National Dealers Warranty and Auto Warranty Protection Services.  At the time of the consolidation, Gilman was president of both companies. Mark Travis was listed as vice president of both firms; Nicholas Hamilton (more…)

Cochise County residents can do their part to reduce the millions of tons of electronic waste that ends up in landfills, protect against identity theft and support local non-profits at an event scheduled Saturday, Feb. 19 from 9 a.m. to 12 p.m. at Ace Hardware, 3756 E. Fry Blvd in Sierra Vista.

Better Business Bureau of Southern Arizona has partnered with the Sierra Vista Police Department, Ace Hardware, World Care, Westech Recyclers, Inc., and Shred-it for ShredFest 2011. Organizers are offering electronics and cell phone e-cycling in addition to secure, on-site shredding. Donations for on-site shredding are appreciated.

What to Bring
Electronic equipment such as: PC systems, CPUs, monitors, mice, keyboards, printers, scanners, laptops, modems, hard drives, speakers, power cords, cables, phones, powers strips, desktop copiers, fax machines, cell phones with batteries and small TVs (32″ or smaller, no consoles). Television donations will require a $10 recycling fee.
Paperwork such as: old tax returns, bank statements, check book registers, credit card statements, medical records, NO PLASTIC PLEASE. That means no three ring binders, presentation folders or garbage bags. Data CD’s will be accepted if they are separated from paperwork. There is a five-box shred limit due to time constraints.
Donations
Donations for shredding are appreciated. Your donations will support BBB’s community and military outreach programs in Cochise County.  Electronics and cell phone donations are free with the exception of televisions, which incur a charge of $10. All phone and electronic donations are tax deductible.

Where’s my stuff going?
Electronics: All electronic items will be collected by World Care of Tucson. These items are used in schools, clinics and other institutions nationally and internationally. Those computers not used in humanitarian efforts are also sold to the public at World Care’s book and thrift store. Items deemed unusable are recycled for their plastics, metals, glass, and other parts. This last process is especially important as computers produce harmful and toxic waste.

Paperwork: All paperwork will be securely shredded by Shred-it of Tucson. All shredded material is recycled. As an affordable risk management tool, outsourcing to a reputable “On-Site” shredding company like Shred-it of Tucson has become a normal, economical and accepted part of doing business today. Shred-it of Tucson, a BBB Accredited Business’ offers an array of convenient services to businesses and consumers in southern Arizona. For more information about Shred-it of Tucson visit www.shredit.com, or call 1-800-697-4733.  Did you know? Arizona is the identity theft capital of the U.S.

For more information please contact BBB at 520-732-9823 or email info@tucson.bbb.org.