While the deadline for Virginia residents to file state taxes isn’t until May 1, many people are starting to shift their attention from returns to refunds as April 15 – national Tax Day – inches closer. In doing so, most of us are getting our first taste of new rules that require refunds to be disbursed through direct deposit or a Way2Go Prepaid Card, rather than a traditional check in the mail.
Anyone with a bank account probably has experience with direct deposit, which means they can simply opt for that and turn the refund process into business as usual. But with more than 34 million U.S. households being characterized as either unbanked or underbanked, it figures that a large segment of Virginia taxpayers will be forced to go the prepaid card route.
With that in mind, we evaluated the Virginia Tax Refund Way2Go Card in order to help Commonwealth consumers avoid unnecessary fees and confusion in the weeks to come. Please find below the card’s fee schedule, a breakdown of its Pros & Cons, and our overall recommendations for consumer use.
|Transaction Type||Service Fee|
Account access to Go Program® website to activate card, check balance, view transaction history
|Online purchases and Online Bill Pay||Free|
|Purchases at merchant using signature||Free|
|Purchases at merchant using PIN (you may also ask for “cash back”)||Free|
|Low Balance and High Dollar Transaction Alerts (email, phone or text message)*||Free|
|Instant mobile balance request (initiates a real-time two way request for balance information)*||10¢|
|ATM cash withdrawal at MoneyPass® ATMs||One Free per month, $2.50 per withdrawal thereafter|
|ATM cash withdrawal at non-MoneyPass® ATMs||$2.50 per withdrawal (ATM surcharge may also apply)|
|ATM balance inquiry at MoneyPass® ATMs||One Free, 35¢ each thereafter|
|ATM balance inquiry at non-MoneyPass® ATMs||50¢ each|
|Bank teller cash withdrawals at any MasterCard® member bank or credit union||One Free, $2 each thereafter|
|ATM denial for insufficient funds||50¢ each|
|Funds transfer to another U.S. Bank (IVR or web transfer)||One Free, $2 each thereafter|
|Card Replacement (After activation)||$5 each|
|Expedited Card Replacement (Two business days)||$18 each|
|Account access via voice activated phone system||Two Free calls per month, $1 each call thereafter|
|Cardholder calls to Go Program® Representative||Two Free calls per month, $2 each call thereafter|
|International ATM Cash Withdrawal||$2.50 each plus 2% of the withdrawal amount|
|International Transaction Fee on Point-of-Sale (POS) transactions||2% each transaction|
|Card Inactivty Fee||$3 per month (Once card has been activated, after six months of no activity and balance is greater than zero)|
|Mailed Account Statements||$2.50 each|
- Initial Free Access to Cash: Cardholders are entitled to one free withdrawal from a MoneyPass ATM each month as well as a single free wire transfer to a bank account and a single cash withdrawal through a bank teller over their account’s lifetime. It’s therefore possible to cash you income tax refund without wasting any money on fees.
- No Purchase Fees: You can use the Way2Go Card to make unlimited point-of-sale purchases at merchant locations.
- Limited Free ATM Withdrawals: The fact that you only get one free ATM withdrawal per month (and only at certain ATMs) would make the Way2Go card an expensive and aggravating replacement for a traditional checking account – as prepaid cards are so often used.
- Inability to Load Funds & Pay Monthly Bills: Only government agencies can load funds to the Way2Go Prepaid Card. In other words, you can’t set up direct deposit of your paycheck or just directly load funds as needed.
- Confusing Fee Schedule: A quick look at the Way2Go Card’s fee schedule leaves one with a number of unanswered questions that can only be answered through a detailed examination of the fine print in the cardholder agreement.
- Costly Customer Service: You get two free customer service calls per month. After that, each call will cost you $1-2 depending on whether you want to reach an automated system or a real person.
- Inactivity Fees: If you don’t use your card for six months, you’ll begin to incur a $3 monthly inactivity fee.
While the Way2Go Card enables you to access your state tax refund for free, its fee structure and lack of key features also make high costs likely and recurring use impossible. The best strategy is therefore to opt for direct deposit whenever possible and otherwise withdraw funds from your prepaid card account as soon as you can. This card is not built for recurring use.