Connecticut To Use Debit Cards For Refunds

The State of Connecticut has indicated that it will stop issuing paper refund checks and instead will use Chase Bank debit cards.  These cards will need to be activated before they can be used.  CT taxpayers can opt-out and receive their refund by direct deposit, however they will not have the option to receive a check unless a taxpayer’s refund in exceeds $10,000, one is collecting refunds on behalf of the deceased or  has an offshore bank account.

“Issuing tax refunds as debit cards provides a security and convenience not available with paper checks,” DRS Commissioner Kevin B. Sullivan said in a release. “Couple that with the elimination of check cashing fees and the refund debit cards are a benefit for taxpayers and the state.”

The plastic cards will come in the mail and people will have to contact Chase to activate them. They can be used to access the money at ATMs or at retailers that accept them.

While Sullivan emphasized convenience, the DRS move follows a similar one made by the state Labor Department which began issuing unemployment insurance benefits on debit cards in 2011 and also allowed for direct deposit of benefits. The Labor Department, which also selected Chase for its program, said the move was expected to save about $200,000 a month in printing and postage costs…Like its Labor Department deal, Chase has agreed to limit fees and people can avoid being charged if they use a Chase or People’s United Bank ATM. However, fees can be charged if other ATMs are used, or if users leave money on the card for more than one year.