H&R Block

H&R Block: The largest tax-preparation chain

H&R Block (*est. $150-$200 for average return) is far and away the biggest tax-preparation chain in the U.S., with close to 12,000 storefronts and a huge market share. The next-closest competitor, Jackson Hewitt, which operates out of Wal-Mart stores, does less than half of H&R Block's volume. We found some positive comments from users about H&R Block's services, and repeat customers seem to be especially satisfied (usually because they've found an individual tax preparer with whom they like working).

H&R Block differs from its next-biggest competitor, Jackson Hewitt, in that it offers numerous options for filing returns electronically. Via the H&R Block website, you can e-file for free using TaxCut software (see the ConsumerSearch report on tax preparation software for more information about this product), or pay $14.95 for audit support, $39.95 for one free session of tax advice and audit support, $79.95 for unlimited tax advice, or $99.95 for a full online package (full-service tax preparation and unlimited tax advice). All these options are cheaper than visiting a brick-and-mortar H&R Block location and sitting down with a live professional. Jackson Hewitt's e-filing options are comparatively stingy; all you can do is ask your live tax preparer (at a Jackson Hewitt location) to zap your return to the IRS.

Reviewers note that H&R Block has come under considerable legal and consumer pressure for its marketing practices, especially pertaining to its refund-anticipation loans (RALs). In January 2009, the chain agreed to stop marketing RALs in California as genuine refunds. It turns out that many customers thought they were getting government-issued refund checks, when in fact they were receiving loans direct from H&R Block, complete with fees and high interest rates. There are a huge number of complaints from customers about H&R Block's RAL practices on ConsumerAffairs.com, and RALs in general are severely criticized by financial experts.

H&R Block has recently introduced a new financial product related to RALs--the Emerald Card, a prepaid MasterCard onto which the RAL money is transferred. Reviews point out that if you check the H&R Block website, you'll see that the Emerald Card is loaded with an astonishing number of fees: $1 every time you check your balance, $1 every time you receive a paper statement, $1.95 every time you withdraw money, and a whopping $20 for over-the-counter withdrawals on personalized cards.

As the biggest tax-preparation chain in the U.S., H&R Block hires a huge number of seasonal employees, and we found comments to the effect that many of these seasonal preparers have minimal qualifications. As far as we can tell, there's currently no government-administered certification program for tax preparers. More than a few sources warn against H&R Block's $30 "Peace of Mind" extended audit insurance, which reviewers say is next to useless, and reviews are similarly critical of this chain's high-fee banking services.