H&R Block said it is re-aligning its tax and corporate structures and putting CEO Russ Smyth in charge of tax operations.

The company plans to combine its previously separate retail tax, digital tax, franchise operations, company field operations and corporate units in the tax sector into a single integrated structure. As a result of the changes, Tim Gokey, president of the retail tax unit, is leaving the tax prep chain.

Block has been facing challenges. The company saw a decline in the number of tax returns it prepared this past tax season, although it charged customers more per return (see Fees Increase at Block, but Number of Returns Falls). The company was also hurt by the mortgage crisis, which led it to ditch its Option One mortgage unit.

“Over the past year, the company has successfully divested our mortgage and securities brokerage business units, “ said Block chairman Richard Breeden in a statement. “As a result, we are now able to convert from a holding company structure with multiple siloed businesses into an integrated management structure for our tax business. By reducing layers of management and artificial divisions between different tax business channels, we believe we can achieve greater client focus, faster reaction time in the market, and reduced overhead expense. Having our CEO Russ Smyth lead the tax business directly will accelerate our ability to enhance the client experience, and help to revitalize our tax organization as we make it flatter and more nimble.”

Smyth (pictured) added that the company plans to put more emphasis on its rapidly growing H&R Block Online unit, which provides a Web-based version of Block’s TaxCut software, as well as remote tax prep services, support and advice from Block employees. “Our new structure will help the entire company focus on serving tax clients whether they need face-to-face assistance, software and online products to prepare their own returns, or something in between,” he said.


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