If you are new to professional tax preparation, or if you have a new preparer on your team who needs a quick orientation, this article covers the basics of bank products: what they are, how they work, and why they matter for your clients.
What a Bank Product Is
A bank product is a financial service offered through a partnership between a tax software provider and a banking institution. The most common type is a refund transfer, sometimes called a refund processing service.
When a client chooses a refund transfer, their tax refund is deposited into a temporary account held by the banking partner. Your preparation fees and any applicable bank product fees are deducted from that account, and the remaining balance is disbursed to the client through direct deposit, a prepaid debit card, or a paper check.
The client pays nothing out of pocket at the time of service. Your fees are collected automatically through the settlement process.
The Core Benefit for Clients
The most direct benefit is simple: clients can file their taxes today without needing cash on hand to pay your preparation fee. For many working families, that removes the primary barrier to filing on time.
Beyond the upfront cost question, bank products often provide faster access to refund funds than a standard IRS direct deposit timeline. For clients who are counting on their refund to cover bills, rent, or other expenses, a few days can matter.
The Core Benefit for Your Office
Bank products eliminate the most common point of friction in the client intake process. When cost is no longer an obstacle at the front door, more clients move forward. You also eliminate the time and awkwardness of collecting payment at the point of service, which simplifies your workflow during a season when every hour counts.
What It Costs
Bank product fees vary by provider and by the specific arrangement your office has in place. Working through a service bureau like Profit Edge Tax typically provides access to lower bank product fees than preparers can negotiate on their own, which makes the product easier to present and more attractive to clients.
Once you understand how bank products work, the next step is learning how to present them confidently. See How the Top 1% of Tax Preparers Will Use Bank Products to Help Their Customers This Tax Season for a practical guide to presentation and positioning, and Why Your Clients Say No to Bank Products (And What to Do About It) for help with the objections that come up most often.