Who’s Getting Stuck with RALs?

Issue Brief
March 28, 2007 Download PDF

HB 3076 would help Oregon’s low-income families

Refund Anticipation Loans (RALs) are transferring substantial amounts of refunded tax dollars intended to support low-wage working families into the pockets of tax preparation companies. Much of the fees tax preparers collect from these loans come out of Earned Income Credit (EIC) refunds. The EIC is a federal income tax credit 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 (63 percent) of Refund Anticipation Loan customers in 2004 were EIC recipients, and 18 percent of EIC recipients used Refund Anticipation Loans.

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