FTC Cracks Down on H&R Block’s Alleged ‘Free’ Filing Fiasco

  • The FTC filed an administrative complaint against H&R Block, alleging the tax preparation company violated the FTC Act when it misleadingly advertised its online products as “free” and unfairly complicated the process for customers wishing to downgrade to more affordable product offerings.
  • According to the complaint, H&R Block allegedly directed consumers unnecessarily towards more expensive online product offerings designed for complex tax situations, which many did not require. The FTC further alleges that H&R Block would impose time-consuming obstacles for consumers attempting to downgrade their products that were not in place when upgrading, such as requiring contact with customer support and deleting all previously entered tax data. In addition, the FTC claims H&R Block falsely advertised its tax preparation services as “free” despite many consumers being ineligible for the free offerings.
  • The FTC proposes several corrective actions against H&R Block including, among other things, prohibiting the company from making the downgrade process more burdensome than upgrading, mandating that the company provide clear instructions for downgrading, and stopping the company from making misleading representations about its product details, costs, or any material facts regarding its “free” product offerings.