H&R BLOCK’S GUARANTEE CHALLENGED IN CLASS ACTION SUIT

April 5th, 2013

For millions of consumers, a tax return refund is likely the largest check they will receive during the year. Because of this, refund checks are highly anticipated and will be used for a variety of things, including home repairs, vacations, and even catching up on past due bills.

Tax preparation giant H&R Block has famously helped consumers file tax returns for generations. In recent years, they have launched products that ostensibly help consumers get their returns faster; even offering refund anticipation loans and credit cards.

Even with their success and reputation in preparing returns, mistakes can be made. This has led to a recent class action lawsuit accusing the company of mishandling returns that resulted in a delay in refunds. Essentially, several Michigan plaintiffs filed suit alleging that H&R Block’s software failed to incorporate information into Form 8863, used to claim educational credits. The IRS reported that a change in how it electronically processes information may have contributed to the problem.

The issue reportedly affected 600,000 returns.

H&R Block prides itself on its accuracy and even advertises that its returns will be 100 percent accurate. The plaintiffs believe this proclamation amounts to false advertising. Companies have a legal duty to avoid using statements or slogans that would lead customers to believe that a product or service is not what it is advertised to be.

H&R Block’s CEO issued an apology, explaining that a mere apology won’t bring returns very quickly, but he insisted that the company was working diligently to remedy the situation.

Meanwhile, the plaintiffs are seeking to establish a class and obtain compensation for those affected by the mistake.

Source: TopClassActions.com, H&R Block hit with class action over delayed tax refunds, April 4, 2013

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