The contractual agreement for a Refund Anticipation Loan (RAL) is between:

In a Refund Anticipation Loan (RAL) scenario, the contractual agreement is specifically between the taxpayer and the lender. The taxpayer applies for the loan based on the anticipated refund from their tax return, and the lender provides the funds upfront, with the expectation that the loan will be repaid once the IRS processes the taxpayer’s return and issues the refund.

This agreement is crucial because it outlines the terms, including the loan amount, fees, and repayment process, which the taxpayer must understand before entering into the loan. The lender takes on the risk by advancing the funds based on the tax refund, while the taxpayer agrees to the terms associated with borrowing against their expected refund.

Other entities, such as electronic filing providers or the IRS, do not directly enter into the loan agreement. The electronic filing provider may facilitate the process by submitting the tax return but does not have a financial interest in the loan itself. In contrast, the relationship between the IRS and the taxpayer is related to the tax refund process rather than the loan arrangement.