Has anyone experienced issues with direct deposits of tax refunds being denied by the receiving bank due to ABA number issues and the funds being held up at TurboTax?

Forum|Forum|3 years ago
September 9, 2022
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TurboTax Online

Best answer by Critter-3

So even if you opt for Direct Deposit, TPG will issue a check. I just went on the TPG website and the Account overview indicated that payment was to be made by Direct Deposit. Thanks for information. I'm on hold with TPG now, let's see what happens. Will let you know.

Ok ... simply put ... the refund goes from the IRS to the processing bank ... at no time does it go to TT.

Next the processing bank withholds the TT program fee & their processing fee and sends the remainder of the refund to the taxpayer. If the DD is refused by your bank then the processing bank can convert the deposit to a paper check mailed to the address you had on the tax return and it does come in a plain white envelope with only the return address on it which can be mistaken for junk mail. The processing bank can also hold the money for any reason they deem necessary and may require you to provide them with some extra security details before the funds can be released. Your only option is to contact the processing bank as already mentioned in this thread. And after a certain time passes the processing bank may send the remainder refund back to the IRS.

xmasbaby0

Employee

Your tax refund was not sent to TurboTax. TurboTax does not handle your refund at all.

Santa Barbara Tax Products Group, LLC (SBTPG) is the bank that handles the Refund Processing Service when you choose to have your TurboTax fees deducted from your refund. This option also has an additional charge from the bank that processes the transaction.

You can contact them SBTPG, toll-free, at 1-877-908-7228 or go to their secure website www.sbtpg.com

https://ttlc.intuit.com/questions/2580357-who-provides-the-refund-processing-service

https://ttlc.intuit.com/community/refunds/help/who-provides-pay-with-my-refund/00/26410

**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.**

JoeNJ525Author

I spoke with the IRS who insisted that the funds if they were not accepted by the bank due to an incorrect ABA# where being diverted to TurboTax and this issue is not uncommon.

xmasbaby0

Employee

@JoeNJ525 The agents at the IRS do not always understand how "refund processing" works when you choose to have your TurboTax fees deducted from your federal refund, so they may think---incorrectly--- that the refund went to TurboTax. It did not NOT go to TurboTax. When you choose to have your fees deducted from your refund, the refund goes to the third party bank. That bank takes the fees out of your refund and sends the rest of your refund to your account. If there has been a problem with that process, you hav to deal with the third party bank---as already detailed in the reply you received earlier. TurboTax does not get your refund.