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Why you may not get all of your tax refund

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OKLAHOMA CITY — Oklahoma taxpayers shouldn't wait for that tax refund check to arrive in the mail this year. That's because if you don't have a bank account for a direct deposit, the Oklahoma Tax Commission will only issue that refund on a debit card.

That debit card, however, includes a number of fees if you're not careful.

If you have your state tax refund directly deposited into your bank account, nothing is changing.

But a new state law is requiring those paper payments to become electronic payments.

Last year, the state sent out more than 477,000 paper refund checks.

So they say going paperless will save taxpayers money.

“We know we will save in excess of half a million dollars just on the postage of the checks,” Tax Commission's Paula Ross said.

She says for those who don't have bank accounts, they won't have to pay traditional check-cashing fees to get their refund.

Plus, the card can be used to make purchases like any other debit card.

But there are potential fees.

A $1.50 monthly fee is charged if the card isn't used at all for 60 days.

A 75-cent fee is charged if you personally transfer the balance to your bank account online.

A $2 fee is charged if you make more than one withdrawal on that card at a bank.

“We do realize it's their money, but with any business, all the debit card companies do have that non-usage fee,” Ross said. “So there wasn't a way for the Treasurer to avoid that.”

Ross says the state is complying with House Bill 1086, which passed last year and says “payments disbursed from the State Treasury shall be issued through electronic payments only.”

The bill's author, Rep. Jason Murphey (R-Dist 31), says while going paperless is meant to save the state about $3.6 million, it may be revised next session if these fees rack up.

“It (HB 1086) wasn't necessarily targeted towards recipients of tax refunds but certainly there should never be a fee on a recipient of their own tax refund,” Murphey said.

So to avoid debit card fees, either cash out the entire balance or don't wait 60 days to use it.

We're told the state does not collect those fees.

A Xerox company, Affiliated Computer Service, gets the fees because they're running the program.

Ross says the State Treasurer picked them because they had the lowest non-usage fees.

LINK: More on the new tax refund debit card.