Is anyone else having trouble with TurboTax's "pay out of your federal refund" feature?

[meboyer87]

TurboTax says I do not have a sufficient amount in my federal refund to cover the transaction, but this is false. The amount of my federal refund is higher than the transaction/service fee. I have not received a Recovery Rebate Credit or any other stimulus payment credit. Why isn't TurboTax allowing me to choose my federal refund as my source of payment?

[xmasbaby0]

There are no recovery rebate credit or stimulus payments on a 2022 tax return, so not sure why you are mentioning that.   If you are trying to file a 2020 or 2021 return, you can only file by mail, so refund processing is not available to you.

REFUND PROCESSING

https://ttlc.intuit.com/community/charges-and-fees/help/why-can-t-i-deduct-my-turbotax-fees-from-my-...

If your refund is enough to cover your TurboTax fees PLUS the extra “refund processing” fee of $40 ($45 in CA) and your forms are ready then when you are in the FILE section you can choose to have your fees deducted from your federal refund by a third party bank, who will take out your fees and send you the rest of your refund after the IRS issues the refund. 

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 ever 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.  

And....you can never pay state tax due from a federal refund, so do not expect that.   The state tax due has to be paid directly to your state.

What is Refund Processing Service?

How can I see my TurboTax  fees?   

https://ttlc.intuit.com/questions/2565973-how-do-i-review-my-fees-in-turbotax-online

[robtm]

A lot of people have problems with this feature because of additional bank fees the Santa Barbara bank applies. The best way to avoid this is to direct deposit your refund into your checking account and pay TT fees with your credit card,

[meboyer87]

Yeah, I mentioned the credit/stimulus because it pops up as a possible reason that Turbo Tax can't take the fee out of my refund. Also, seriously, an additional $40 charge? Good grief. Thanks for the heads up!

[meboyer87]

Yeah I'm seeing that there's an additional $40 "refund processing fee" (???) which is just. Ludicrous. Every year I somehow manage to forget what a dumpsterfire this program actually is. I think it's time to find a new service. Thanks for your time and your reply!