IRS Expands Direct Deposit Options

Posted on 07. Jun, 2006 by in Taxes

Hands down the IRS’s direct deposit option has been one of the smartest things it has ever done. In fact, the IRS estimates that over half of all filers are using direct deposit with refunds of over $134.2 billion direct deposited last year. However, the option has always been restricted to one account.

The IRS recently announced that in order to encourage more saving (something all of us could benefit from) the IRS is going to offer Form 8888 which will give taxpayers the choice of depositing their refund into one, two, or three accounts such as checking, savings and retirement accounts.

I for one applaud this new option as at least one more way to encourage saving your tax refund instead of just spending it like a second Christmas. However, my biggest fear is that the only ones who are going to find out about this option is the people reading this and other financial blogs. Hopefully the IRS makes it very clear that this is an option come April…

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