Saturday, April 20, 2013

MN Taxpayers Just Got Screwed for Corporate Profit

- if you don't have a checking account
- or you don't want to give the state access to your checking account
you're tax refund will be on a debit card.

Just so that everyone out there realizes that this may impact you – this is from the Minnesota Property Tax Refund Booklet for 2012.

Note: Tax year 2012 is the last year you will have the option to receive your refund by paper check. Refunds will be issued via debit card or through direct deposit.

Starting with refunds issued in 2014, the department will replace paper refund checks with prepaid debit cards. If you don’t choose the direct deposit option on returns filed after January 1, 2014, you will receive a debit card loaded with the amount of your refund.
You will still receive a paper refund check when filing a return in 2013.
From CBS News

For taxpayers who bypass the direct bank account deposit option, the Minnesota Department of Revenue will issue debit cards. For some lawmakers, that poses privacy worries.

The Minnesota House declined Saturday to halt the conversion while a study about data storage and debit card security is conducted. Republican Rep. Mary Liz Holberg says she’s worried that there won’t be adequate safeguards on electronic transactions when taxpayers spend their refunds.

And where does the corporate profit come in?
From Governing magazine
Banks make money off the cards by earning interest on thefunds before they’re spent by taxpayers, charging merchants each time the cards are swiped, and levying various fees on the consumers who use the cards. In most cases, the debit card fees are structured so that, with some planning, taxpayers can avoid most or all of the associated fees. In South Carolina, for example, there’s no fee for using the card to make purchases from merchants that accept Visa debit cards, and taxpayers don’t pay a fee when they withdraw cash from Bank of America ATMs.

But if a taxpayer isn’t careful, the fees can add up. In South Carolina, recipients who lose a card must pay $15 for a timely replacement. Withdrawing cash from a teller costs $10 after the first trip. Fees such as those have prompted some criticism from consumer advocates, who say residents shouldn’t have to pay to access money they’re owed by the state. After all, those who receive debit cards because they lack bank accounts are the same people who can least afford to be nickel-and-dimed with fees, says Ken Edwards, vice president of federal affairs at the Center for Responsible Lending.
Yeh - let's just screw those who have the least among us - AGAIN and AGAIN.
To increase corporate profits - to increase bank profits.

And where does the corporate profit come in?
Many tax payers in Virginia are frustrated with the Commonwealth's new way of distributing state tax refunds.
When Elieen Pribble received her daughter's state refund, she couldn't believe the ordeal that would follow.

"A dollar here, and a dollar there. That's a lot of money they're making just because their system doesn't work, and they're dropping calls." Pribble said.

Her daughter was sent a debit card loaded with her refund instead of a check. The debit card distributions are new to the Commonwealth this year. So far, 300,000 people have received debit card refunds, but many are just learning how costly they can be.

You're charged up to $2 just to transfer your cash from the system. And every time you call customer service, those calls, which often fail, cost a $1 each.
There is NO WAY IN HELL - you can convince me that the state HAD TO DO THIS.  I am totally convinced that there was an HUGE exchange of VISA debit card money/payola along the way here.

Fees such as those have prompted some criticism from consumer advocates, who say residents shouldn’t have to pay to access money they’re owed by the state.

Who cares if taxpayers get screwed 
- as long as the banks and credit card companies 
- make more money.

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