What Is an H&R Block Rapid Refund?

Rapid Refund was the name of a loan instrument offered by H&R Block tax preparers that delivered, for a fee, the expected amount of the client's net tax refund. According to Forbes, this program amounted to a short-term payday loan with interest rates of up to 185 percent.

In 2001, the New York Times reported that H&R Block had been ordered to cease using the term "Rapid Refund" by federal court judge Raymond Jackson. The term was ruled to be deceptive because it concealed the true nature of the loan that was being marketed. Judge Jackson described annualized interest rates of up to 500 percent and the lack of disclosure as reasons for brokering the consent decree to cease advertising the program as anything other than a short-term loan.

A modified version of the program continued under the name "refund anticipation loan" for another decade after the court's ruling. As reported by Forbes, however, H&R Block suspended its loan program for the 2012 filing season. One reason cited by Forbes was the greatly reduced turnaround time taxpayers experienced in receiving their refunds. By 2012, the IRS anticipated that what had been an eight-week delay had shrunk to only two weeks, making the high-interest loans less desirable for customers.