IRS to end release of taxpayer debt information

[Robbien]

Source: AP

The Internal Revenue Service said Thursday it will end its policy of releasing information about back taxes and other debts owed by taxpayers in the coming tax season.

The information, called debt indicators, has been included on acknowlegements the IRS sent to tax preparers when electronically-filed returns were received by the agency. The indicators served as a warning that some or all of the person’s refund might be held back to cover old debt, including back taxes, unpaid child support or delinquent federal student loans.

They are typically used by tax preparers to decide if a taxpayer can get a refund anticipation loan. These short-term loans have been criticized by consumer advocates for charging high interest rates and fees in exchange for providing access to money backed by refunds just a few days before the refund itself arrives.

In 2007, nearly 9 million taxpayers paid more than $900 million in fees for such loans, according to a report by the Consumer Federation of American and the National Consumer Law Center.

Read more: http://economy.kansascity.com/?q=node/7941

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H&R Block will just have to come up with a new scheme to bilk its customers.