Colorado Governor Signs Bill Providing Consumer Protection in Tax Refund Loans

DENVER—Colorado Gov. Bill Ritter (D) signed a bill (H.B. 1400) May 19 placing new restrictions on facilitators that offer tax refund anticipation loans.

The measure, which will take effect Aug. 11, creates the Refund Anticipation Loans Act and addresses new requirements in the practice of offering short-term loans to consumers in anticipation of the consumer receiving a tax refund.

Under the bill, individuals who facilitate refund anticipation loans must be employed by an electronic return originator—a person or company authorized by the Internal Revenue Service to originate the electronic submission of income tax returns.

Also under the legislation, a refund ...