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How Does a Tax Advance Loan Work

User Guide on How a Tax Advance Loan Works

Whether this is your first time filing taxes or you just want a refresher, this guide will tell you everything you need to know about getting a Tax advance loan from tax preparers like ATC Income Tax.

What is a Tax Advance Loan?

To start, a tax advance loan is when you borrow money using your expected tax refund as collateral before you get that refund from the IRS. Let’s say your refund is estimated at $3,000 – with a tax advance loan, you can access part of that money upfront.

The Refund Advance Product

The primary tax advance loan offered by ATC is called the Refund Advance. With this product, you can qualify for a loan of up to $6,000 or 25% of your anticipated refund amount, whichever is less. And the best part? It gets approved in under 10 minutes.

When getting a Refund Advance loan, interest fees apply to amounts over $2,500 borrowed. But the first $2,500 is available at 0% APR. This means you pay $0 in interest on the first chunk of your loan.

So, How Does the Repayment Work?


  • When the IRS processes your tax return and issues your refund, they’ll use that money to pay off the loan balance you borrowed from ATC.
  • You’ll get the remainder of your refund within 10-14 days.
  • Something else beneficial about ATC is its zero lender fees. From start to finish, you won’t be charged any hidden charges when taking out a Tax advance loan—just the clearly stated interest on amounts over $2,500.

How Does the Repayment Work

In-Depth Explanation of How a Tax Advance Loan from ATC Income Tax Works

Disclaimer:”Tax Advance Loan” is offered by ATC Income Tax, subject to specific terms, conditions, and eligibility requirements.

Eligibility Requirements

To qualify for ATC’s Tax Advance loan program, the primary criteria include:

  • Having filed taxes and received a refund in at least one of the past two years.
  • Earning enough income to expect a refund more significant than the loan amount requested reasonably.
  • Providing valid IDs, SSNs, and bank info for verification purposes.

Note: ATC may deny an application if they cannot confirm your identity or refund eligibility. But in general, most people who file taxes each year are eligible to apply.

Interest Rate Calculations

For amounts up to $2,500 borrowed for a tax advance loan, you’ll pay $0 in interest.

Above $2,500 is where rates apply. The typical interest fee is 7.5% of the loan amount for each 14 days financed. For example:

  • Borrow $3,000.
  • $2,500 covered at 0%.
  • The $500 portion above is 7.5% for a typical 14-day loan period.
  • 5% of $500 is $37.50 in interest.

Be sure to ask your tax preparer for the specific interest calculation on your loan amount, as rates may vary.

Loan Repayment Process

Most electronically filed returns take about 21 days for the IRS to process. Once processed:

  • IRS sends the refund amount to ATC to pay off the outstanding loan balance.
  • Any remaining additional refund balance gets sent to you.
  • On average, refund balances get issued within 10-14 days after IRS approves returns.

So, the total process from applying to repayment is usually less than 30-45 days on most simple tax returns.

Key point: The IRS refunds the loan directly.

Want to Know More?

There are a few key things people often wonder about, so we’ll try to cover all the nitty gritty details here about the tax advance loan:

Step By Step Process for Tax Advance Loan:

Now that we covered the basics let me explain the application process step-by-step:

Step 1

Find out your estimated refund amount. Your tax preparer at ATC can help calculate this based on your income and last year’s return.

Step 2

Once you know your estimated refund, you can see how much you qualify for in a Tax advance loan – usually 25% or up to $6,000 of your total refund amount.

Step 3

Fill out a short loan application online or in person at ATC. They’ll just need basic info like your Social Security number, income details, ID, and bank account numbers.

Step 4

If approved, you could have the funds from your Tax advance loan deposited to your bank account or on a Faster Money prepaid visa card in as little as 10 minutes!

Step 5

When tax filing season ends and the IRS processes returns, they’ll use your refund amount to pay off the loan balance before releasing any extra funds.

Step 6

  • You’ll get the remaining refund directly deposited or mailed to you within 10-14 days on average once everything clears with the IRS—no more waiting weeks for a paper check to arrive.
  • And that about sums up the loan process. Let us know if any part is still unclear – contact us, and we’ll explain further.
  • The team at ATC Income Tax is also super helpful if you have additional questions when applying. We aim to make the Tax advance loan process as simple and stress-free as possible.
  • Going with a trusted lender is the way to get fast access to your refund while paying little to no interest. Feel free to reach out if you have any other questions.

Applying Online?

To apply online, go to the ATC website, fill out the loan request form, and upload copies of your documents. You’ll receive updates on the status via email.

Drop-Off Applications?

If more convenient, fill out the paper form in person, then drop it, plus the docs, at any ATC office location for electronic submission later.

Checking Status?

For both online and dropped-off requests, you can check progress by logging into your application account portal on the website.

For Identity Verification

For security, ATC may need to verify your ID, income, residence, and other details before final approval. This often involves soft credit checks, too.

Conditional Approvals

Some applicants with limited credit history may get conditional approval requiring a co-applicant or guarantor if requested.

Funding Timeframes

Once fully approved, expect funds in 10 minutes for debit cards or 1-3 business days for direct deposit, depending on your bank’s processing speeds.

Declined Requests

If denied, you’ll receive a notification by mail/email with reasons like ineligibility or unverifiable information. Reapply once issues are addressed.

Application Assistance

Feel free to ask your preparer for help at any point. They know the process and common approval factors to optimize your chances.

Managing Documents

Keep all application materials and loan correspondence organized and accessible if ATC needs additional verification later in tax season.

These details help provide a fuller picture of getting started with the tax advance loan process through ATC Income Tax.

Things to Keep in Mind

While refund loans are essential, be mindful of fees and carefully calculate your needs. Some additional considerations:

  • Only borrow what you truly need to avoid excess interest charges.
  • Repayment is guaranteed if you file accurate taxes and qualify for a refund.
  • Any refund reduction or owed taxes must still be repaid in full.
  • Due to IRS processing delays, late fees apply if repayment is not made on time.

As long as your return is in order, a tax advance loan can help you access funds sooner at competitive rates. However, you need to be an accurate tax preparer to avoid issues.

Submitting Tax Returns Through Our Experts?

Once your return is complete at ATC, the tax preparers will submit it electronically to the IRS. From there, it typically takes:

  • It takes three weeks or less for simple returns to be processed.
  • 4-6 weeks for returns with errors or issues.
  • 10-12 weeks for returns submitted by mail.

So, e-filing is the fastest option. If processed within three weeks, it meets the typical window for loan repayment. Any delays could incur added interest charges on the advance.

Managing Loan Communications

Stay connected with ATC and read all documentation thoroughly. To keep on top of your loan:

  • Verify that the personal details and bank accounts are correct on file.
  • Note the due dates on any correspondence received from ATC.
  • Communicate promptly about any IRS delays or problems.
  • Watch for repayment notifications once your return is processed.

Lenders depend on timely communication to process loan payoffs accurately. Be responsible and reach out with questions as needed.

Pre-qualify BannerBenefits Of Getting a Tax Advance Loan

Here are some potential benefits of getting a tax advance loan:

Quick access to funds

You can get approved within minutes and receive money on the same day or within a few business days, far faster than waiting 4-6 weeks for a tax refund from the IRS.

Low or no cost

Many tax advance loans provide the first $2,500 interest-free, and any amount over that is typically charged with minimal interest for short 14-day loan terms.

Improved cash flow

If you are expecting a refund, a loan allows you to use a portion of those funds before tax season to pay bills or expenses.

Covers balances owed

If your return results in tax due rather than a refund, the loan can be applied to the balance you owe to avoid penalties from the IRS.

Convenient repayment

You don’t have to actively repay the loan since it is automatically deducted from your tax refund when the IRS processes your return within a few weeks.

No impact on IRS refund

As long as you qualify for the refund amount, your advance loan does not reduce the total refund the IRS will issue; it is just the portion not used for repayment.

Credit building potential

On-time repayment can help demonstrate responsible use of short-term credit to creditors reviewing your file.

Removes filing stress

Having extra cash upfront relieves financial pressure.



A Tax advance loan allows you to access part of your expected tax refund before you get that money from the IRS. It’s a great short-term financing option if you need cash fast before tax season wraps up. Just be sure to go through a reputable lender like ATC Income Tax.

Please Note:

The final date to submit your 2023 tax returns is April 15th, 2024. However, the deadline extends to April 17th, 2024, for Maine and Massachusetts residents. Avoid the rush and ensure you’re prepared by contacting ATC Income Tax Services in Decatur now to get a jump start on the process.


What happens if I owe taxes instead of receiving a refund?

If your return results in taxes owed rather than a refund, you are still responsible for full repayment of any tax advance loan. Tax returns must be prepared correctly to avoid surprises.

Can I still apply if I didn’t file last year?

While two years of filing history is preferred, exceptions may apply if you have sufficient income documentation to verify your eligibility for the current year’s refund. Discuss your specifics with an ATC tax professional.

How quickly can my refund be reduced or offset after taking a loan?

Federal refunds are protected from garnishment for at least 60 days after issuance. The IRS or other levy holders cannot reduce the refund amount during this time. After this grace period, any portion not used to pay off a tax advance could potentially be offset.

What happens if my refund is delayed past the loan repayment date?

If the IRS processing time exceeds typical periods, the loan will require an extension and potentially accrue interest charges until your return is finalized. Notify ATC right away about anticipated processing delays to discuss extension options.

Can I get a tax advance loan for my business taxes as a sole proprietor?

Yes, sole proprietors can qualify for a loan against their anticipated personal tax refund from business income reported on Schedule C. The same eligibility rules apply to personal filings. Discuss specifics with your ATC tax preparer.

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