Liberty Tax uses multiple banks depending on your state and loan type
Liberty Tax does not use a single bank for all refund advance loans. The company partners with different lenders in different states, and the bank that funds your loan depends on where you file and which product you choose. When you take out a refund advance through Liberty Tax, you are borrowing from a third-party lender, not from Liberty Tax itself — the tax preparation company is the intermediary.
The most common lender Liberty Tax has used is Community Financial Services Limited, which operates under the brand name CFS. However, this partnership has changed over time, and other lenders have been involved in different years and states. Because these partnerships shift, the specific bank funding your loan may not be the same one that funded someone else's loan in a different year or state.
When you apply for a refund advance at a Liberty Tax location, the tax preparer will tell you which lender is offering the loan that year. You will see the lender's name on your loan agreement and disclosure documents before you sign anything.
Key Takeaways
- Liberty Tax partners with third-party lenders rather than using its own bank, and the lender varies by state and tax year.
- Community Financial Services Limited (CFS) has been a primary lender for Liberty Tax refund advances, but other lenders may be involved depending on where you file.
- The lender's name and terms appear on your loan agreement before you sign, so you will know exactly who is lending the money.
- You can ask the Liberty Tax preparer which lender is funding loans in your state during the current tax season.
How to find out which lender is funding your specific loan
The fastest way to know which bank will fund your refund advance is to ask at your local Liberty Tax office before you sign any paperwork. The tax preparer will have information about which lenders are available in your state that year and can show you the loan agreement from that specific lender.
If you have already taken out a loan and want to know the lender's name, check your loan agreement or the disclosure documents you received. The lender's name, address, and customer service number will be listed on these papers. You can also look at your bank account — the deposit will come from the lender's bank, and that bank name may appear in your transaction history.
If you are trying to find out before you visit Liberty Tax, you can call your local office and ask which lender they are working with that tax season. This information changes year to year, so asking directly is more reliable than searching online for past partnerships.
What happens after the lender funds your advance
Once the lender approves your refund advance, the money is deposited into a bank account you provide — usually a checking account. This happens within one to three business days in most cases. The lender will then wait for your actual tax refund to arrive from the IRS or your state tax authority.
When your real refund arrives, it goes to the same account. The lender automatically deducts the loan amount, interest, and fees from that refund. If your refund is smaller than the advance, you may owe the difference. If your refund is larger, you keep the remainder after the loan is paid off.
The lender sends you statements showing the loan balance, payments, and when the debt is settled. Keep these documents for your records, especially if you need to dispute a charge or verify that the loan was paid in full.
Why Liberty Tax uses different lenders
Refund advance loans are not offered by banks in the traditional sense. They are short-term loans that exist only during tax season and depend on the IRS or state tax authority actually sending a refund. Because of this unusual structure, only specialized lenders offer them, and they do not operate in every state.
Liberty Tax partners with lenders that have the infrastructure to process these loans quickly and handle the coordination with tax authorities. Different lenders operate in different states based on licensing, regulations, and business decisions. This is why the lender you work with may be different from the lender your friend used, even if you both filed through Liberty Tax.
These partnerships also change from year to year. A lender that worked with Liberty Tax in 2023 may not in 2024, or a new lender may enter the market. This is normal in the refund advance industry and does not reflect a problem with Liberty Tax or the lender.
What to check before you sign a refund advance agreement
Before you agree to a refund advance through Liberty Tax, read the loan agreement carefully. The document will show the lender's name, the loan amount, the interest rate or fee, the repayment terms, and what happens if your refund is delayed or smaller than expected.
Make sure you understand the total cost of the loan. A refund advance typically costs between $50 and $300 depending on the loan size and the lender. Some lenders charge a flat fee; others charge interest. The agreement will spell out exactly what you owe.
Ask the tax preparer to explain any terms you do not understand before you sign. You have the right to decline the refund advance and wait for your actual refund instead. Taking the advance is optional, even if the preparer suggests it.
What to do if you have a problem with the lender
If the lender makes an error, charges you incorrectly, or does not deposit the money as promised, contact the lender directly using the phone number on your loan agreement. Most lenders have customer service lines during tax season and can resolve issues quickly.
If the lender does not respond or you believe you were treated unfairly, you can file a complaint with the Consumer Financial Protection Bureau (CFPB) at consumerfinance.gov. The CFPB handles complaints about lending practices and can investigate if a lender violated consumer protection laws.
You can also contact your state's attorney general office or banking regulator. Keep copies of your loan agreement, deposit receipts, and any correspondence with the lender. These documents support your complaint if you need to escalate the issue.
Frequently Asked Questions
Can I choose which lender funds my refund advance?
No. Liberty Tax works with specific lenders in your state, and you can only borrow from the lender they partner with that year. You can decline the refund advance entirely and wait for your actual refund, but you cannot select a different lender through Liberty Tax.
Is the lender the same as the bank where I keep my money?
Usually not. The lender that funds your refund advance is a specialized company that offers short-term loans during tax season. Your personal bank is separate. The advance money will be deposited into your account at your bank, but the lender is a different institution.
What if the lender goes out of business before my refund arrives?
This is rare, but if it happens, you are still responsible for repaying the loan. The loan obligation transfers to whoever takes over the lender's accounts, or you may be contacted by a debt collector. Your actual tax refund will still arrive from the IRS or state, and it will be used to pay off the loan.
Can I pay back the refund advance early without penalty?
This depends on the lender's terms. Some lenders allow early repayment without extra fees; others charge a penalty. Check your loan agreement or call the lender's customer service line to ask about early repayment options before you sign.
Will the refund advance affect my credit score?
Most refund advance lenders do not report to credit bureaus, so the loan typically does not show up on your credit report. However, if you default on the loan or it goes to collections, it can damage your credit. Read your agreement to see whether the lender reports to credit bureaus.