The Rush card is a pre-paid Visa card that charges customers money to access their accounts. Image from Flickr.

Rush Card is one of the many pre-paid credit card options available. The Rushcard service, like most prepaid cards, has features that can make it very useful, especially for people who cannot get or do not want a regular credit card. However, before you make a decision about getting a Rush Card, it is important to understand both the benefits and high costs of the system.

How Rush Card works

While Rush card markets itself as a “pre-paid credit card,” it works more like any other debit card. A customer can load the card with money, and then use it anywhere a Visa card is accepted. Money is debited from your Rushcard account, and when the balance reaches zero, any other transactions are declined. Some Rush card accounts also allow cardholders to write checks against the account balance. Rushcard charges fees for the use of the Rush card. Rush Card was created in 2003 by Russell Simmons, under the business name UniRush.

Benefits of Rush Card

The Rush Card does provide some benefits to cardholders. A credit card can be very difficult to get for individuals with bad credit. Because Rush Card works on the Visa system and has a full credit card number, it can be used to make online purchases and where a credit card would normally be used. The pre-paid system also means that it is impossible to overdraw your Rush Card account – no overdraft fees and no high interest rate credit.

High costs of the Rush Card

The Rush Card, however, does not work like a standard checking or debit account. Depending on which of the two types of Rush Card a customer gets, the fees can be very high. Activation and monthly fees can run as high as $19.95. There are fees for ATM balance inquiries and withdrawals. There are statement and “maintenance fees.” There is a fee for paying bills with the Rush Card. The highest cost fee, however, can be the “convenience fee.” This convenience fee charges between 50 cents and $1 each time your Rush Card is swiped or used to make a purchase. Long story short, the Rush Card could cost you $100 a month or more — to access your own money.

Alternatives to the Rush Card

The Rush Card does offer some convenience in accessing and using money. However, fees for standard transactions make it incredibly expensive. If you have bad credit or no credit, a checking account is most likely a better solution than the Rush Card. Many credit unions offer “starter” bank accounts designed especially for customers who would have difficulty getting a checking account at a bank. These starter accounts usually do not carry nearly the fees that the Rush Card does, and a debit card offers the same benefits as the Rush card. Even if you have had financial problems in the past, check with multiple banks or credit unions to see if they can offer help – before you sign up for the high fees of the Rushcard.

Sources:

Rushcard schedule of fees
Consumer Affairs . com

Few things strike fear into a person’s heart like the thought of an IRS audit. People harbor this fear, not simply because of the money that they may end up having to pay the government, but also because an audit can lead to a loss of property or even jail time. It can even lead to an extreme need for instant cash, like taking out multiple payday loans. While most people are honest and diligent in accurately reporting tax information, for those who are not, this nightmare can easily become a reality.

By avoiding the following activities, a person might also avoid an IRS audit:

A Return Filled With Errors

The easiest way to raise questions about a tax return is to overlook mathematical errors, careless mistakes or by forgetting to include important information. While this seems easy enough to avoid, many don’t take the time to double check their returns to be sure that the information is accurate and that it makes sense. By not doing so, unwanted attention is drawn to their tax return, which sometimes prompts an IRS audit.

Reporting an Extremely Low Income

Each job or career has an expected income level associated with it. When a person is working in a particular field yet reporting a salary that is far less than expected, this can prompt an audit. Although some people may actually earn less than others in the same field for any number of reasons, such can still raise suspicions and prompt an IRS audit. This is particularly true when an uncharacteristically low income is reported several years in a row.

Not Reporting All Income Earned

Many understand the importance of having multiple streams of income. However, people who work more than one job or those who provide freelance services must be especially careful about reporting all of their earnings. Not reporting every source of income and the amounts earned raises a serious red flag that may prompt an IRS audit. Each employer reports every employee’s income to the IRS, as do companies who pay for the services of certain 1099 workers. Therefore, the IRS knows how much money most people have earned even before the information is officially reported on a tax return. To fail to provide information on additional income will almost certainly result in an audit.

State Tax Returns Do Not Match Federal Tax Returns

Taxpayers are required to file separate returns for their state and federal taxes. When information filed on these returns does not match, an IRS audit may be the consequence. Again, it is very important to pay attention to all of the details provided in a tax return; check for errors and make sure that all information matches before a return is submitted.

Not Filing a Tax Return

Many claim to have found loopholes in the law that makes it possible to escape paying taxes. Others, who feel that income tax laws are unfairly imposed, outright refuse to file returns as a form of protest. People who do not file, however, do so at their own risk. Refusing to file a tax return is one of the fastest and easiest ways to encourage an audit.

While most people are never faced with an IRS audit, those who are find it to be a daunting experience. Whether the faulty reporting that led to an audit was part of an honest error or was a deliberate attempt at defrauding the IRS, few people get away with inaccurate reporting. By filing early, obtaining the help of a professional and paying close attention to detail, however, an IRS audit can be avoided.