H&R Block and Jackson Hewitt Face Off at Tax Time

Jackson Hewitt, America’s second largest tax accountancy firm, has filed suit against H&R Block, its biggest competitor, of libellous claims. They allege that H&R Block has distributed pamphlets at Jackson Hewitt tax return locations stating that Jackson Hewitt makes mistakes in two thirds of its returns.

The increased competition at tax time may be due in part to H&R Block’s being prevented by the government from giving out Refund Anticipation Loans or RAL, which are highly profitable due to guaranteed payment (the loan is paid off as soon as the refund comes through), short loan timeframes, and high interest rates. However, many people, including the government, have been increasingly critical of RAL offerings as they tend to appeal most to those with low incomes and who are in effect paying to have their own money loaned to them.

Jackson Hewitt has claimed the attack by Block was in response to Jackson Hewitt’s claim that they offer faster turnaround time on than Block, which is five times larger. Jackson Hewitt says that H&R Block’s claims about their accuracy are “false, misleading, and highly disparaging,” while H&R Block has said that they stand by their advertising.