Yes, because when using that service, your Federal refund first goes through a temporary account opened for you at an intermediary bank where the TurboTax fees are deducted. You will avoid that fee by paying for TurboTax upfront with credit/debit card or a prepaid debit card you can buy in a store.

DoninGA

Level 15

Yes, the additional fee to have the TurboTax account fees paid from the federal tax refund is an additional $40.

xmasbaby0

Level 15

Yes-----that is the EXTRA fee you pay if you choose to pay your fees from your federal refund instead of paying BEFORE you e-file by using a credit or debit card. You do not have to do that.

Please make note that if your refund takes too long to arrive (IRS delays, etc.) then you will also be agreeing that the TurboTax fees can be extracted from your bank account even before your refund is issued by the IRS. This comes as an unpleasant shock to many people every year.

If you can possibly pay your fees upfront using a debit or credit card, it will save you that extra fee and even more importantly, the possible aggravation and delays that are often the result of poor handling/poor customer service by that third party bank. We see way too many instances where refunds are delayed for months when users choose refund processing. There have been lots of complaints; there are a number of things that can go wrong when you use refund processing. I suggest avoiding that situation if at all possible.

If you have not e-filed yet----

TO REMOVE REFUND PROCESSING FEE

https://ttlc.intuit.com/questions/1900517-how-do-i-remove-refund-processing-fees-in-turbotax-online-and-change-my-payment-method

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Kellbone

Level 2

I have been using TurboTax for years and I'm just now realizing the $40 charge, had I of known that I would have for sure paid upfront,, CRAZY,, every time you turn around another charge is being added.

xmasbaby0

Level 15

@Kellbone That "refund processing" fee for paying your TurboTax fees by having them deducted from your federal refund has been effect for many years. If you choose to pay using your refund it is an extra $40---if you are in CA it is $45. Avoid the extra fee by paying upfront with a credit or debit card.