Dollars & Sense

Some customers seek fee refunds after H&R Block errors

Updated: 2013-03-21T05:02:00Z

By MARK DAVIS

The Kansas City Star

Frustrated customers of H&R Block Inc. have begun to ask for some of their tax preparation fees returned after reports that the company’s error has delayed their refunds for weeks.

And at least some of those customers are reportedly being told that the delays aren’t Block’s fault.

The claims run counter to Kansas City-based Block’s official acknowledgment that its electronic filing errors are causing thousands of federal tax refund delays.

“This was our mistake — and I sincerely apologize,” chief executive Bill Cobb said in a statement March 15.

Ruth Stratton of South Fallsburg, N.Y., heard no such admission from the woman she reached at her Block office on Wednesday.

“She said it was the IRS’ fault,” said Stratton.

She said she understood that the problem was a “computer glitch” at the IRS.

She couldn’t get an answer to her other question. Like others calling Block offices these days, Stratton wants back some of the $250 or so she paid to have her taxes done.

“It would be nice to get half of it if they made the mistake,” Stratton said.

Floria Estes in Irvine, Ky., had arranged in late January to let Block take her tax preparation fees out of her refund. Still without a refund, she called her Block office and asked that some of those fees be forgiven.

That’s when she said she was told it wasn’t H&R Block’s fault. It was the IRS.

H&R Block spokesman Gene King said Wednesday that the company is in regular contact with Block offices about many subjects, including the tax refund delays. He would not say what employees are being told to say about who is at fault.

“We serve 14 million clients in 11,000 offices with close to 90,000 tax pros, and there could be inconsistencies in communications from time to time,” King said. “Where we learn of them, we work to set the record straight.”

The company said that the tax forms in question were properly completed, both by tax office employees and by Block software, but that the problem lies in electronically filing the returns with the IRS.

“We will continue to update our associates and clients as more information becomes available,” King said. “We thank clients for their patience while we work with the IRS to expedite the filing process on their behalf.”

Word of Block’s tax filing problems reached Abraham Rodriguez during his computer networking class at Kaplan Career Institute. Classmates said they had gotten their refunds using TurboTax or other rival tax services and told him about the reports regarding Block.

But Rodriguez heard denials when he called his local Block office in Harrisburg, Pa.

“She kept saying, ‘We did not mess this up,’ ” he said.

Several Block customers were following up news reports about Block’s errors in handling tax returns that included a form for education tax credits.

Block has said it learned on Feb. 22 that its mistake in the electronic filing of that form was causing processing problems at the IRS. The problems were delaying refunds.

The company first alerted customers publicly on March 7 with a post on Facebook.

That was the day Candice Beverly said she called her Block office in Chesapeake, Va. Her refund had not arrived, though more than the usual 21 days had passed since she had filed through Block.

Beverly said her local Block office told her that refunds take 21 business days instead of calendar days to arrive, something she knew wasn’t true because of what she read on the IRS website. Then, she said, the answer was that maybe the federal spending cutbacks, called sequestration, were holding up her refund.

Beverly said she had called a customer hotline 10 separate times that Block publicized after the news reports. No one has called back.

“I’m so frustrated. I can’t get any results,” Beverly said.

Adding to her angst is the effect of the missing refund. She had written her March rent check before double-checking that the refund had come into her checking account.

It hadn’t, and she had to ask her landlord to hold on to her check until payday.

Her husband also had counted on the refund dollars to pay the renewal fees on his commercial driver’s license. He is still waiting and can’t work driving a truck until the money shows up.

Two Block customers in Michigan — whose refunds have been delayed by the errors — filed a lawsuit this week seeking to recover the fees they paid Block. The lawsuit seeks class action status, which essentially is the court’s approval to represent all similarly situated Block customers.

To reach Mark Davis, call 816-234-4372 or send email to mdavis@kcstar.com.

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