Tax Refund Direct Deposits
Credit Union Advisor, 2006 Fall

With declining share balances at many credit unions, tax refunds (the average refund last year was $2,607) are an opportunity to acquire additional deposits. New this year, the IRS has issued Form 8888, Direct Deposit of Refund. This form will give taxpayers the flexibility of splitting their refund into three different accounts. This option is available for both paper and electronically filed tax returns.

The Form is expected to increase the deposits within financial institutions due to the fact that a member will have the option of setting a portion of his or her refund aside in an interest-bearing account. Given the numerous options your members will have, your credit union will want to make it as easy as possible for members to route direct deposits to your institution. Therefore, remember education of the basics, including how to locate routing numbers and account numbers, is essential to this process in order to facilitate the growth of deposits. This can be accomplished through newsletters or inserts within members’ statements educating them on the correct routing number or how to contact the appropriate credit union staff member. Consider including a sample Form 8888.