Major tax prep chains Liberty Tax Inc. and H&R Block reported that the number of returns they prepared this tax season were flat or down slightly.
For the fiscal year to date, Liberty’s figure for returns prepared in offices and online was virtually flat compared with the prior year. The company reported preparing 1.975 million returns this year in its offices and online combined, against 1.991 million returns last year. The number of returns prepared in offices was up by 0.6%, to 1.83 million, versus 1.818 million last year.
“The 2015 season was disappointing,” acknowledged Liberty chairman and CEO John Hewitt. “The complication and confusion around the Affordable Care Act did not drive the shift to paid preparers or the level of price increase that we were expecting this year, and in fact might have actually reduced overall return counts for the industry.”
Liberty said that the preparation of fewer returns and smaller pricing increases than expected would likely have an adverse effect on the various types of revenue it receives from franchisees during this fiscal year, while some expenses tied to the projected revenue were incurred as planned.
H&R Block reported that through April 16 its total U.S. revenues increased compared to the prior year despite a 0.9% decrease in returns prepared, to 20.5 million.
Compared with the same time last year, total H&R Block U.S. assisted returns prepared fell 4.6% through April 16, to 20,492,000. The company attributed the drop to the second-year impact of discontinuing its free federal 1040EZ promotion and the ongoing impact of industry-wide fraud, particularly related to behavioral shifts in tax filers who claim the Earned Income Tax Credit.
Returns prepared through the company’s tax software products, including online, desktop and mobile applications, increased 8.2%.
Block plans to announce its fiscal 2015 results on June 8.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access