UPDATE 1-Jackson Hewitt may not be able to refinance term loan

* Says may not be able to refinance $25 mln term loan

* Says $339 mln loan may also become current

* Absence of RALs will have adverse impact in 2010

March 17 (Reuters) - Jackson Hewitt Tax Service Inc JTX.N said it may not be able to refinance a $25 million term loan payment due on April 30, due to the likelihood of breaching financial covenants in its credit facility.

In a regulatory filing, the tax preparer said if it is unsuccessful in modifying the credit facility or obtain a waiver or forbearance arrangement from the lenders, the remaining $339 million balance will also be classified as a current portion of the long-term debt.

The company also said a lack of availability of refund anticipation loans (RALs) in its network for the 2010 tax season will have a material adverse effect on its business, financial condition and results of operations.

Jackson Hewitt, which generates majority of its revenue by offering RALs and refund transfers, started to face problems in December when the bank that originated those loans terminated its contract with the company.

Tax preparers like Jackson Hewitt extend refund anticipation loans at high interest rates to taxpayers who expect to receive refunds from the government.

The company also said the level of returns generated from its online offering this tax year were not material. (Reporting by Supantha Mukherjee in Bangalore; Editing by Maju Samuel)