H&R Block Offers Free Mid-Year Check-In to Help Tax Filers Maximize Refunds, Avoid Tax Season Surprises

Rhea-AI Summary

H&R Block (NYSE: HRB) is offering free Mid-Year Care Check-Ins to help taxpayers maximize refunds and avoid surprises for the next tax season. This initiative comes as IRS data shows that while average refunds increased in 2024, fewer people received them. The company provides a free W-4 calculator tool to help filers adjust withholdings and account for side income.

A recent survey revealed that 81% of consumers prioritize maximizing take-home pay through tax withholding optimization, but only 28% feel they have adequate support. H&R Block emphasizes the importance of reassessing tax situations mid-year, especially after life changes like buying a home or changing jobs. The company also highlights the benefits of mid-year check-ins for small business owners and gig workers, including planning for tax reductions and ensuring compliance with new regulations.

Positive

• H&R Block offers free Mid-Year Care Check-Ins to help taxpayers maximize refunds
• The company provides a free W-4 calculator tool for adjusting withholdings
• H&R Block has thousands of locations across the U.S. with tax professionals ready to assist clients
• The company offers a No Surprises Guarantee for clients

Negative

• IRS data shows fewer people received tax refunds in 2024 compared to previous years
• Only 28% of consumers feel they have adequate support for tax withholding optimization

Insights

Financial Analyst

The announcement by H&R Block (NYSE: HRB) of free Mid-Year Care Check-Ins is a strategic move that could potentially impact the company's market position and financial performance. While this service isn't directly revenue-generating, it serves several important business objectives:

• Customer Acquisition and Retention: By offering free check-ins, H&R Block can attract new clients and strengthen relationships with existing ones. This could lead to increased customer loyalty and potentially higher revenue during tax season.
• Brand Positioning: The initiative positions H&R Block as a proactive, customer-centric company, differentiating it from competitors in the tax preparation market.
• Upselling Opportunities: These check-ins provide H&R Block with opportunities to identify clients who may benefit from additional paid services, potentially increasing revenue per customer.

However, the financial impact of this initiative is not immediately clear. The costs associated with providing these free services could potentially offset short-term gains. Investors should monitor future earnings reports to assess whether this strategy translates into measurable financial benefits.

It's worth noting that H&R Block's stock performance has been relatively stable over the past year, with a 52-week range of $28.83 to $44.83. This initiative could be seen as a move to maintain competitiveness in a market facing disruption from DIY tax software and fintech startups.

Overall, while this news doesn't directly impact H&R Block's immediate financial position, it represents a strategic investment in customer relationships and brand value that could yield long-term benefits if executed effectively.

Tax Expert

H&R Block's offering of free Mid-Year Care Check-Ins is a savvy response to changing tax dynamics and consumer needs. The IRS data showing that fewer people received refunds in 2024, despite higher average refund amounts, underscores a critical need for better tax planning among consumers.

This initiative addresses several key issues:

• Withholding Optimization: With 81% of consumers expressing interest in maximizing take-home pay through withholding optimization, H&R Block's free W-4 calculator tool fills a significant market gap.
• Tax Liability Management: By helping clients adjust for life changes like home purchases, job changes, or investment sales, H&R Block can help prevent unexpected tax liabilities.
• Small Business Support: The focus on helping entrepreneurs with quarterly tax payments and industry-specific deductions is particularly valuable, given the complexities of small business taxation.

From a tax policy perspective, this service aligns with the IRS's goal of reducing tax-time surprises and improving overall tax compliance. It's a win-win approach that benefits both consumers and the tax system.

However, the effectiveness of this program will depend on consumer engagement and the quality of advice provided. If successful, it could lead to smoother tax seasons, potentially reducing the strain on both H&R Block's resources and the IRS during peak filing periods.

For investors, this proactive approach to tax planning could translate into a more stable and predictable business model for H&R Block, potentially reducing the seasonality of their revenue streams over time.

KANSAS CITY, Mo., Aug. 01, 2024 (GLOBE NEWSWIRE) -- On average, Americans who received tax refunds in 2024 got more back than in previous years, but fewer people received a refund, according to IRS data. H&R Block (NYSE: HRB) advises taxpayers who owed money or were caught off guard at tax time to conduct a tax assessment now to check that their withholdings and financial setup will serve them well when filing taxes. H&R Block is offering free Mid-Year Care Check-Ins to ensure tax filers are on track for their maximum refund¹ next tax season.

A recent survey commissioned by H&R Block revealed that 81% of consumers say maximizing their take-home pay through tax withholding optimization is important, while only 28% say they have the support needed to fully meet this need.²

Now is the make-or-break time to recalibrate to avoid surprises next year, and H&R Block offers a free W-4 calculator tool that helps filers determine if their current withholding status aligns with their financial goals. The tool assists filers with adjusting their withholdings, accounting for any side income, and creating an updated, ready-to-sign W-4 form all in one place.

“Many life changes happen over the course of a year, like buying a home, getting a raise at work, changing jobs or even selling investments. People may not realize that some of these life milestones can increase tax liability if you don’t properly account for them or know to take advantage of tax benefits created by the change,” said Andy Phillips, Director of The Tax Institute at H&R Block. “H&R Block is here to help people understand how life changes and financial decisions throughout the year can have tax implications and make adjustments as needed to improve outcomes at tax time.”

H&R Block has thousands of locations in cities across the U.S., with talented tax pros ready to help with Mid-Year Care Check-In. Kim Buttler, a Chicago area tax pro who has been helping H&R Block clients for nearly 17 years knows firsthand how big of a difference these financial check-ups can make in a client’s life.

“Part of our job as tax preparers is also advising our clients on how to adjust withholdings to ensure a better outcome in the future. I helped a client who mistakenly marked themselves as being exempt from both federal and state tax withholding and as a result, owed a substantial amount,” said Buttler. “As a single mother, this was devastating because she relied on getting a large tax refund.”

“By doing a Mid-Year Care Check, we can help our clients avoid situations like this. We will even print out a new W-4 form and provide instructions to the client on how to correctly complete it and submit it to their HR department. Now 10 years later I still service that client and look forward to seeing her year after year,” said Butler.

From individuals to small business owners, there are significant advantages to checking your finances and making any necessary adjustments at the halfway point in the year.

New entrepreneurs with self-employment income or a gig work income are often surprised to learn they may need to pay quarterly taxes. On top of ensuring timely quarterly tax payments, small businesses can benefit from a Mid-Year Care Check-In by planning for tax reductions to maximize business credits and deductions, evaluating changes in business structure, and ensuring compliance with new small business regulations like beneficial ownership information reporting to avoid penalties. A check-in can also help keep business records organized to streamline year end bookkeeping.

“Whether you are a solopreneur, a gig worker or a small business owner, it is important to understand your tax obligations but there is also an opportunity to be more strategic to ensure a maximum refund,” said Phillips. “There are some deductions that are universal but there are many that are specific to each industry so it is important to have a partner, like H&R Block, that has your specific industry expertise and can help you understand what you can claim and cannot.”

H&R Block offers a courtesy Mid-Year Check-In to clients as part of its No Surprises Guarantee.³ Some situations are more complex and may benefit from professional advice. To schedule an appointment to talk to a tax professional about unique tax situations and how to adjust withholdings, visit hrblock.com.

1. All tax situations are different. Not everyone gets a refund. See hrblock.com/guarantees for complete details.
2. The total sample size was 3,500 US adults.
3. Limitations apply. Description of benefits and details at hrblock.com/guarantees.

About H&R Block 
H&R Block, Inc. (NYSE: HRB) provides help and inspires confidence in its clients and communities everywhere through global tax preparation services, financial products, and small-business solutions. The company blends digital innovation with human expertise and care as it helps people get the best outcome at tax time and also be better with money using its mobile banking app, Spruce. Through Block Advisors and Wave, the company helps small-business owners thrive with year-round bookkeeping, payroll, advisory, and payment processing solutions. For more information, visit H&R Block News.

FAQ

What is H&R Block's Mid-Year Care Check-In service?

H&R Block's Mid-Year Care Check-In is a free service offered to help taxpayers assess their current tax situation, adjust withholdings, and maximize potential refunds for the next tax season.

How can H&R Block's W-4 calculator tool help taxpayers?

H&R Block's free W-4 calculator tool helps filers determine if their current withholding status aligns with their financial goals, adjust withholdings, account for side income, and create an updated, ready-to-sign W-4 form.

What percentage of consumers prioritize maximizing take-home pay through tax withholding optimization, according to H&R Block's survey?

According to H&R Block's survey, 81% of consumers say maximizing their take-home pay through tax withholding optimization is important.

How can small business owners benefit from H&R Block's Mid-Year Care Check-In?

Small business owners can benefit from H&R Block's Mid-Year Care Check-In by planning for tax reductions, maximizing business credits and deductions, evaluating changes in business structure, and ensuring compliance with new regulations like beneficial ownership information reporting.