More and more taxpayers are using direct deposit to receive
their tax refunds. According to the IRS, more than 84 million taxpayers used
direct deposit last year as their preferred payment method. Typically, the
fastest way to receive your refund is to file your tax return electronically
and use direct deposit.
The obvious advantage of using direct deposit is that it is
fast and secure. That is because your refund is directly deposited into your
bank account. In cases of identity theft, scammers can easily get the refund
directed to another postal address.
With direct deposit, taxpayers do not need to worry about going
to the bank to deposit the refund. That also reduces the risk of the refund
check getting stolen or lost on its way to the taxpayer.
When using direct deposit, taxpayers must make sure that they
enter the correct bank account(s) and routing number. You can use more than one
bank account to receive your refund. This can be a checking, savings, certain
retirement accounts, or health and education accounts. The maximum number of
accounts you can use is three. If you use more than three accounts, the IRS
sends you a notice and issues a paper refund instead.
If you file a joint return, you can get the tax refund
routed directly into your bank account or your spouse’s bank account, or both. Confirm
these details with your financial institution, as some banks only allow refund
deposits into accounts that are in both you and your spouse’s names.
Labels: IRS, Tax Filing, Tax Refunds, Taxpayers