FDIC: You Can Keep More of Your Refund, Even if You Aren't Rich

FDIC Chairperson Sheila Bair recently urged low and middle-income taxpayers to use US Government and bank programs to save a larger proportion of their refund. Among the ideas cited by Ms. Bair were use of direct deposit (less temptation to spend if the money is already in the bank), use of free tax preparation such as VITA for taxpayers who qualify and to take any tax credit which the taxpayer legally qualifies for, even if the taxpayer has to file a more complex variation of the Form 1040 series. The FDIC also encouraged banks to be available to establish new accounts for taxpayers wishing to use direct deposit and extended a carrot in the form of favorable consideration under Community Reinvestment rules to banks showing a willingness to be supportive of low and middle-income taxpayers wishing to establish new accounts.

Many readers will not qualify for some of the ideas mentioned by Ms. Bair. Nevertheless, Ms. Bair is to be commended for encouraging greater savings by low and middle-income Americans.