BY CHELYEN DAVIS

RICHMOND--If you're used to getting a tax refund check from the state every year, brace yourself for a change.

The Virginia Department of Taxation has announced that it will no longer issue state tax refunds by check. Instead, if you're in line for a refund, you'll have to get your money by direct deposit into your banking account or from a pre-paid debit card.

According to a press release, that's because of a General Assembly decision--lawmakers put language into last year's budget bill to eliminate paper refund checks to save money.

The tax department says the state issued more than 1.2 million refund checks last year, and so eliminating paper checks will save about $200,000 annually.

According to the release, most Virginians already choose direct deposit for their tax refunds, which is the fastest way to receive the money.

But if you don't want to do that, the state will send a prepaid debit card with the amount of the refund. Prepaid debit cards can be used like regular debit cards for purchases, or to withdraw money at an ATM.

The tax department said the card is "a more secure and convenient alternative to receiving a refund check in the mail, and eliminates check-cashing fees."

The debit cards will be administered by a division of Xerox Corp., which isn't charging the state, according to the release.

But users of the pre-paid card can incur some fees, according to the department's website.

You can use the card to get cash from a bank teller for free only once, and only once a month can you freely withdraw money from ATMs in the MoneyPass network.

More transactions than that--or use an ATM outside that network--and you incur a $2.50 fee.

And if you don't use the card for six months, you'll be charged $3 a month to maintain the account.

The tax department has posted more information, including a fee schedule for the card and answers to frequently asked questions, at tax.virginia.gov.

Chelyen Davis: 804/343-2245
Email: cdavis@freelancestar.com