H&R Block

H&R Block, Inc.

File:H&R Block logo.svg Logo used since 2003
Company type	Public
Industry	Tax preparation, Financial services
Founded	January 1, 1955 (1955-01-01) in Kansas City, Missouri, United States
Founder	Henry W. Bloch and Richard Bloch
Headquarters	Kansas City, Missouri , United States
Area served	United States, Canada, Australia
Key people	Jeff Jones (CEO), Tony Bowen (CFO)
Products	Tax preparation, payroll management, business consulting, consumer tax software, online tax submission
Number of employees	2700 (full-time), up to 90,700 seasonal (2023)
Website	www.hrblock.com

H&R Block, Inc., commonly known as H&R Block, is a tax preparation firm headquartered in the United States, with operations extending to Canada and Australia. Established in 1955 in Kansas City, Missouri by siblings Henry W. Bloch and Richard Bloch, the company delivers a wide array of services including tax preparation, payroll management, business consulting, consumer tax software, and online tax submission.

By 2018, H&R Block maintained approximately 12,000 retail tax locations worldwide, staffed by experienced tax professionals.

Origins

During World War II, Henry W. Bloch served as an Army Air Forces navigator and envisioned launching a family enterprise with his brothers in Kansas City. After returning from military service in 1946, Henry and his elder brother Leon secured a $5,000 loan to start a bookkeeping firm downtown. When Leon departed to attend law school, their mother’s response to a help-wanted notice led Henry to bring their younger brother Richard into the business.

The duo operated United Business Company, specializing in bookkeeping, accounting, payroll services, and some tax-related tasks. In 1955, an advertisement offering $5 tax preparation services placed in The Kansas City Star attracted attention and resulted in the formation of H&R Block. The brothers deliberately spelled "Block" with a "K" to prevent mispronunciation.

Growth and Development (1956–1980s)

In 1956, the Bloch brothers expanded their operations to New York City, but due to their unwillingness to relocate, they sold that regional branch and instead launched the first H&R Block franchise tax office. The company went public in 1962, marking an important phase of expansion.

By 1980, H&R Block acquired the Compuserve online service to boost its technological capabilities. By 1986, it was processing over 10 million tax returns annually and had entered markets in Canada and Australia, broadening its international presence. That same year, H&R Block partnered with the Internal Revenue Service to introduce electronic filing, establishing itself as a pioneer within the tax preparation industry.

Modern Developments

In 1993, H&R Block purchased MECA Software, recognized for its TaxCut program, but divested MECA by 1995 while retaining ownership of TaxCut. Throughout the 1990s, the company diversified into financial sectors such as mortgage lending and banking. It acquired Option One Mortgage in 1997 and Olde Discount Stockbrokers for $850 million in 1999. The latter operated under H&R Block Financial Advisors until its sale to Ameriprise Financial in 2008 for $315 million; at that point, the brokerage managed assets totaling $30 billion with a network of 900 advisors.

Also in 1999, H&R Block acquired assets from McGladrey & Pullen LLP (excluding audit functions), creating RSM McGladrey Business Solutions and becoming the sixth-largest accounting firm in the United States. McGladrey operated 100 offices across 25 states and was affiliated internationally through RSM International. This unit was sold back to McGladrey & Pullen in 2011.

Jeff Jones—previously an executive at Target and Uber—was named CEO in October 2017 following Bill Cobb’s retirement and interim CEO Tom Gerke’s tenure. Jones aimed to position H&R Block as both a retail and financial services organization with an emphasis on growth.

In October 2017, H&R Block inaugurated its first Global Technology Center located in Technopark, Trivandrum, India, to advance product engineering and IT solution development.

In June 2019, H&R Block broadened its digital capabilities by acquiring Canadian fintech Wave Financial for US$405 million. Wave specializes in bookkeeping, accounting, and payroll services tailored for small businesses and continues operating independently under CEO Zahir Khoja from Toronto.

H&R Block's Tax Reporting Issues 2005

In August 2005, H&R Block revealed it had inflated its earnings for the years 2003 and 2004 by $91.1 million, attributing this to inadequate resources for handling complex corporate tax matters. Subsequently, in February 2006, the company acknowledged errors in calculating state income taxes for 2004 and 2005, leading to an additional $32 million liability in unpaid taxes.

Exposure of Social Security Numbers 2005

During December 2005, H&R Block inadvertently printed customers' Social Security numbers on mailing labels while distributing complimentary TaxCut software to former clients and recipients of purchased mailing lists. The company assured that no information was compromised or stolen and that fewer than 3% of mailings contained this error.

Refund Anticipation Loans Litigation 2006

In February 2006, California Attorney General Bill Lockyer initiated legal action against H&R Block, accusing the company of improper marketing of high-interest refund anticipation loans (RALs), primarily targeting low-income consumers. The lawsuit asserted that H&R Block profited substantially, sometimes acquiring nearly half of the loans, and wrongfully withheld tax refunds to offset outstanding debts. H&R Block maintained that its refund loan program complied with legal standards and was equitable.

By January 2009, H&R Block reached a $4.85 million settlement with California officials, agreeing to halt misleading promotions of RALs as immediate tax refunds. The agreement included $2.45 million in restitution for customers affected between 2001 and 2008, $500,000 in fines, and $1.9 million covering fees and expenses. By 2011, the company had completely discontinued offering RALs, a decision praised by consumer protection advocates.

Express IRA Marketing Lawsuit 2006

In March 2006, New York Attorney General Eliot Spitzer filed suit against H&R Block over deceptive advertising related to its Express IRA accounts, claiming fees resulted in losses for approximately 85% of account holders. Most allegations against H&R Block and its divisions were dismissed by a state judge in 2007, except for certain claims involving H&R Block Financial Advisers. However, a New York appellate court reinstated the lawsuit in 2009, which was later settled that same year. As part of the resolution, H&R Block agreed to pay between $11.4 million and $19.4 million in customer reimbursements plus $750,000 toward legal costs.

Corporate affairs

Based in Kansas City, Missouri, H&R Block operates under the guidance of an eleven-member board chaired by CEO Jeff Jones alongside CFO Tony Bowen. The organization employs roughly 2,700 full-time staff members and expands its workforce seasonally with up to 90,700 additional employees. Generating annual revenues exceeding $3 billion, the company also manages The Tax Institute at H&R Block to support its tax service operations.

Marketing

H&R Block has launched notable marketing initiatives featuring celebrities such as Jon Hamm and Anthony Davis. A key campaign during the 2017 Super Bowl showcased the deployment of IBM Watson technology within retail outlets. In 2024, the company introduced Responsibility Island, a parody miniseries combining tax themes with reality television elements aimed at engaging Generation Z consumers.

Corporate social responsibility

Collaborating with Military One Source, H&R Block offers complimentary tax preparation services to military personnel. In 2014, it debuted the Budget Challenge—an interactive financial literacy game designed for high school students—which provided college scholarships through 2019 as part of its Dollars & Sense program.

Retail and digital tax solutions

H&R Block operates with a workforce of 70,000 employees across 10,000 retail tax locations throughout the United States. In addition to its physical offices, the company provides digital tax preparation tools and services, having processed 23 million tax returns worldwide in 2016.

In 2017, H&R Block introduced two new services: Tax Pro Review and Tax Pro Go. Tax Pro Review enables customers to prepare their returns online with a professional's oversight, whereas Tax Pro Go caters to individuals filing taxes online who prefer not to or cannot visit a physical office.

The tax software is offered in Free, Deluxe, Premium, and Self-Employed versions. Key functionalities include compatibility across multiple devices, the ability to import W-2 forms via photos, an extensive searchable knowledge base, and complimentary live chat support with tax experts available for Deluxe and Premium subscribers.

Block Advisors

Launched in January 2016, Block Advisors provides year-round tax preparation services to consumers. Approximately 350 Block Advisor locations have been established, staffed by certified public accountants, enrolled agents, or H&R Block-certified master tax advisors.

Collaborations

In 2014, H&R Block entered into a strategic partnership with Xero, designating it as the exclusive small business online accounting solution promoted within its 11,000 branded outlets offering Small Business Program services.

By 2018, H&R Block secured an exclusive agreement with Walmart to be the only desktop tax preparation software retailed in Walmart stores. Additionally, in 2017, the company collaborated with Amazon to enhance the visibility of its software products.

Also in 2017, H&R Block teamed up with IBM to incorporate IBM Watson AI technology into its retail offices, assisting tax professionals in delivering more precise tax return preparations.

In 2018, a partnership with LendingTree was established to provide customers access to credit scores through the MyBlock platform.

As of 2022, H&R Block’s tax services share user information with Facebook for targeted advertising purposes. This data sharing includes sensitive financial details such as those related to health savings accounts and education expenses and often occurs without explicit user consent—even for individuals who have opted out.

Additional products and services

In 2013, H&R Block introduced the Expat Tax Services program aimed at U.S. citizens living abroad to broaden its market presence. The company also markets financial products like the Emerald Card prepaid debit card and the Emerald Advance credit line. Its Tax Identity Shield service offers protection against identity theft, complementing its range of tax-related solutions.

H&R Block Bank

Founded in 2006, H&R Block Bank was sold to Axos Financial in September 2015. Axos Financial managed the Emerald Card product until 2020, reflecting a strategic evolution in H&R Block’s approach to financial services.