A Pre-Ack loan is a refund advance loan approved during the period before the IRS has issued its first acknowledgement of the tax season. The IRS issues its first acknowledgement of the tax season during the controlled launch phase of electronic filing, aka HUB Testing, the time period when the IRS tests the electronic filing system by receiving a limited number of tax returns in advance of the official opening of e-file.
To offer Pre-Ack loans, an ERO must first be approved by a bank to use its products to facilitate refund transfers, then be separately approved to offer refund advance loans, then be further approved to offer Pre-Ack refund advance loans.
What makes a refund advance loan a Pre-Ack loan is that it is explicitly marked as a pre-ack loan. An ERO should clarify with the bank if a refund advance loan application during the Pre-Ack period is presumptively a Pre-Ack loan, or if the taxpayer has the option of choosing between Pre-Ack or in-season (sometimes called "Post-Ack").
If the bank approves the taxpayer's refund advance application, and the advance is marked as Pre-Ack, the loan will be issued before the return has been accepted by the IRS. If the advance is not marked as Pre-Ack, the loan will be issued after the IRS accepts the return.
Pre-Ack loans may carry a higher interest rate, due to their higher risk, and the ERO may pay a special fee for each approved Pre-Ack loan, so both EROs and taxpayers should evaluate carefully using Pre-Ack loans.