Lawmakers seek more education about refund cards

By Melinda Deslatte

Associated Press

Published: Tuesday, April 10 2012 4:45 p.m. MDT

BATON ROUGE, La. — JPMorgan Chase officials said Tuesday that they will do more to educate Louisiana residents receiving tax refunds on debit cards about how they can avoid fees for accessing their money.

Louisiana's revenue department has replaced refund checks with pre-paid Chase Visa cards for taxpayers who don't get their refunds through direct deposit into a bank account. The department said doing away with the checks saves money.

But members of the House Appropriations Committee said they have received complaints from people who don't understand how to use the cards or have been charged fees when they do.

"We're going to do everything we can to get more information out," said John Daniel, a senior vice president with JPMorgan Chase. He added, "This is the first year. We need to tweak this. There needs to be some fine-tuning. We need to work with the Department of Revenue to refine this."

Louisiana's one of the first states to issue debit cards for personal income tax refunds.

Taxpayers can get their money at Chase ATMs or use the cards to pay for items at retailers. They also can bring the card to a Chase bank and get their refund through a cash advance.

They are charged fees if they use non-Chase ATMs to access the money more than once and if they want to transfer the money to a non-Chase bank account. The ATM fee is $1.50 per use and the transfer fee is 75 cents, said Tracy Dangott, vice president and senior product manager with JP Morgan Chase

"I'm finding a lot of resistance back in my district," said Rep. Jim Fannin, D-Jonesboro, chairman of the Appropriations Committee.

Fannin said he's repeatedly heard from people that they've got to wait three days to use the card after activating it, though Dangott said that's not the case.

"There's some miscommunication somewhere," Fannin said.

Sixty-five percent of individual income tax refunds processed so far have been distributed by direct deposit to banks. But one-third of tax filers didn't choose that route, and they don't have the option to get a paper check.

More than 365,000 tax refund debit cards have been issued so far, and Dangott said he expects that to top 500,000 by the end of tax season. Of the $72 million in refunds paid out on debit cards, about $64 million has been spent or transferred off the card, according to the revenue department.

Lawmakers worried that the debit cards will keep people from getting their money are pushing a bill that would require people to decide if they want their refunds on a debit card. The proposal by Rep. Regina Barrow, D-Baton Rouge, awaits debate on the House floor.

Online:

House Bill 635 can be found at www.legis.state.la.us

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