In a recent announcement, the South Carolina Department of Revenue (SCDOR) has informed taxpayers and tax professionals, including CPAs, about a significant change in their refund disbursement process. Effective June 29, 2023, the SCDOR will no longer issue debit cards for tax refunds. This stems from Bank of America’s decision to phase out pre-paid debit cards. Bank of America has served as the Department’s debit card provider.
Instead of debit cards, SCDOR will now solely rely on direct deposit or paper checks for issuing tax refunds to eligible taxpayers. While most taxpayers already receive refunds via direct deposit, you may have clients who use the pre-paid debit card. If you have clients who received refunds via debit card, alert them to this change. Bank of America will start alerting those with debit cards in November, giving them 90 days to spend the balance or cash out the card. The card will be deactivated on February 1, 2024.
After June 29, SCDOR will send a paper check to filers who select the debit card option. In the release, SCDOR notes that direct deposit is its preferred refund option.
