Who's Losing Out From RALs?

Issue Brief
March 25, 2005 Download PDF

Low-income working households are the largest group that would benefit from HB 3163 refund anticipation loan reform

Refunded tax dollars that could help low-income families make ends meet and boost local economies are instead ending up in the pockets of tax preparation companies. That is the result of refund anticipation loans (RALs), short-term and often high-cost loans advertised as rapid tax refunds. Tax preparers often collect the RALs fees out of the federal Earned Income Tax Credit (EITC) refunds anticipated by low-income taxpayers.

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Who’s Losing Out From RALs? (PDF)

The federal EITC is targeted at low-income working families and is designed to honor work, keep families together, reduce poverty and offset the payroll taxes of workers in low-paying jobs. In Oregon, nearly two-thirds of RAL customers in 2006 were federal EITC recipients, and 18 percent of federal EITC recipients used RALs.

HB 3163 would establish consumer protections for RALs. The tables below show, by state House and Senate districts, the share of Oregon’s RAL recipients in 2006 who claimed the federal EITC and the share of federal EITC recipients using RALs.

RALs by Oregon Senate District

Senate DistrictSenatorTotal # of RALs# EIC recipients with RALs% of RALS going to EIC recipients% of EIC recipients getting RALs
1Kruse2,7031,76665%21%
2Atkinson2,6231,77468%19%
3Bates2,2471,55569%17%
4Prozanski1,7441,09063%15%
5Verger2,7921,78664%22%
6Morrisette2,2861,52867%19%
7Walker2,0011,26663%16%
8Morse1,6101,02964%16%
9Girod2,3881,43860%20%
10Winters2,3121,49765%22%
11Courtney3,1172,11168%22%
12Boquist2,2251,41664%19%
13George1,8351,09059%17%
14Haas1,40580257%14%
15Starr1,65198560%15%
16Johnson2,3921,32455%19%
17Bonamici1,31476158%14%
18Burdick98952853%11%
19Devlin66535153%10%
20Schrader1,7421,02359%17%
21Rosenbaum1,60189256%12%
22Carter2,2851,49565%17%
23Dingfelder1,7381,07662%15%
24Monroe2,8721,88266%19%
25Monnes Anderson2,4431,49561%19%
26Metsger1,74895955%13%
27Telfer2,7001,62060%18%
28Whitsett2,4311,67369%18%
29Nelson2,8191,82065%21%
30Ferrioli2,6901,84969%21%
Senate District Average2,1121,32963%18%

Source: OCPP presentation of IRS data for the 2006 tax year compiled and sorted by legislative districts by the Brookings Institution.




RALs by Oregon House District

House DistrictRepresentativeTotal # of RALs# EIC recipients with RALs% of RALS going to EIC recipients% of EIC recipients getting RALs
1Kreiger1,207 792 66%19%
2Freeman1,496 974 65%23%
3Maurer1,396 977 70%20%
4Richardson1,227 797 65%17%
5Buckley908 634 70%14%
6Esquivel1,338 921 69%21%
7Hanna1,167 748 64%18%
8Holvey577 342 59%11%
9Roblan1,490 978 66%23%
10Cowan1,302 808 62%20%
11Barnhart843 523 62%15%
12Beyer1,443 1,005 70%21%
13Nathanson805 497 62%14%
14Edwards, C.1,196 769 64%17%
15Olson1,200 772 64%20%
16Gelser409 257 63%11%
17Sprenger1,360 854 63%22%
18Gilliam1,027 584 57%17%
19Cameron1,161 734 63%22%
20Berger1,151 764 66%21%
21Clem1,662 1,127 68%23%
22Komp1,457 985 68%21%
23Thompson1,194 745 62%20%
24Weidner1,031 671 65%18%
25Thatcher1,159 718 62%19%
26Wingard676 372 55%15%
27Read632 365 58%14%
28Barker775 436 56%14%
29Riley820 502 61%16%
30Edwards, D.832 482 58%15%
31Witt1,088 615 57%18%
32Boone1,304 709 54%19%
33Greenlick462 257 56%11%
34Harker852 505 59%16%
35Galizio673 398 59%16%
36Nolan315 130 41%6%
37Bruun468 254 54%13%
38Garrett197 97 49%7%
39Kennemer794 451 57%16%
40Hunt948 572 60%18%
41Tomei971 572 59%15%
42Bailey630 320 51%9%
43Shields896 568 63%14%
44Kotek1,389 927 67%20%
45Dembrow878 565 64%16%
46Cannon860 511 59%14%
47Smith, J.1,420 939 66%19%
48Schaufler1,451 943 65%19%
49Kahl1,366 859 63%20%
50Matthews1,078 636 59%18%
51Barton994 558 56%15%
52VanOrman754 402 53%12%
53Whisnant1,474 897 61%19%
54Stiegler1,226 723 59%17%
55Gilman1,179 765 65%17%
56Garrard1,253 908 72%19%
57Smith, G.1,268 822 65%19%
58Jenson1,551 998 64%23%
59Huffman1,464 983 67%21%
60Bentz1,226 866 71%20%
House District Average1,056 665 63%18%

Source: OCPP presentation of IRS data for the 2006 tax year compiled and sorted by legislative districts by the Brookings Institution.