High interest “tax refund anticipation” loans are popular with many people who need money fast. But they are most popular with people living on 4 Indian reservations in South Dakota.

Some of these loans are taken out prior to even preparing tax returns, in December, and based on paycheck stub information which they use to calculate the anticipated refund. Many use this as a way to get extra money for Christmas and later must go back and pay the preparer up to $150 additional to file their taxes.

The IRS has decided to block tax preparers who offer free services through the IRS Free File program from offering refund anticipation loans, but the same tax preparers offer them at their branch offices.

Tax refund anticipation loans popular on state’s reservations