H&R Block Class Action Lawsuit Filed

Second Class Action Filed Against H&R Block over Alleged Tax Refund Delay

Forget the date - tax season isn't over for some. A software glitch that’s affected nearly 600,000 H&R Block users, delaying their tax refunds by almost a month, has left the company open to a second class action lawsuit after a first filed in April over questions about their "100% accuracy guarantee." Software problems lie at the heart of the lawsuit – for which CEO Bill Cobb has already issued a public apology:

The class action suit alleges that customers have since suffered substantial monetary damages.

Let me set the record straight about the Form 8863 issue that has affected you, our valued clients: we made a mistake when the tax return was sent to the IRS. And you deserve an apology, an explanation, and to know what we’re doing about it.

Here’s what happened: this year’s tax season started later than any in history (January 30th), followed by a further delay in form 8863 not being accepted until February 14. Not good for everyone. When the IRS began accepting the form, we immediately sent your returns, with the intention of getting you your refund as quickly as possible. In our zeal to move so quickly, we missed a step. Specifically there was a disconnect in the transmission of form 8863 from our delivery system to the IRS E-file system, and this caused the delay many of you are experiencing. We fixed the transmission issue right away, but couldn’t undo it for those that had already been sent.

The disconnect allowed for parts of Form 8863, relating to education credits, to be left blank – despite the IRS’s policy, as of 2012, of requiring further input and affirmative declarations. The resulting delay in the payment of tax refunds affects roughly 10% of H&R Block customers who filed before February 22, 2013. The class action suit alleges that customers have since suffered substantial monetary damages including, but not limited to, the amount paid for the service, the delayed refund, and the cost of third parties used to correct defendant’s errors. The cases also allege that the failure to deliver “100% accuracy” effectively constitutes a breach of contract and breaks state consumer protection laws.

Was the apology enough? For many, the answer’s a resounding “no” unless it’s accompanied by compensation for plaintiffs and members of the proposed lawsuit – with the second class action seeking more than $5 million in damages for members of the proposed class nationwide.

The cases mentioned above are:

Green, et al. v. H&R Block Inc., et al., Case No. 13-cv-11206, Michigan Eastern District Court.

Maighan O. Perry Dreyling, et al. v. H&R Block Inc. et al., Case No. 13-cv-2011, U.S. District Court for the Northern District of California

Be sure to check back for regular updates and the latest developments as these cases continue.