Directing your refund to pay off a loan is not an option available to taxpayers. Current IRS procedures only allow you to deposit your refund into a checking or savings account. This can be an individual or a joint account you have with your spouse. You can also opt to have the IRS send you a check by mail or use your refund to buy U.S. savings bonds.
You may even choose to do a split refund. That means you can direct some of your refund to your checking account to use now and some to your savings account for that rainy day. Your tax refund can be deposited in up to three accounts at the same or multiple financial institutions. Each deposit must be at least $1.00. You also can split your refund between direct deposit and a paper check [source: IRS].