H&R Block's online tax software allegedly deceived users into paying higher fees, FTC investigation reveals
Just saw this news and I'm pretty annoyed because I've been using H&R Block for years! The Federal Trade Commission is going after H&R Block claiming their online tax prep service deliberately misled customers into spending more money than necessary. Apparently they used some kind of deceptive tactics to push people into higher-priced tiers even when they qualified for free options. I'm wondering if anyone else experienced this? Last year I started with what I thought was their free version but somehow ended up paying $85 by the end. They kept saying I needed to "upgrade" for some form I had. Now I'm wondering if I was one of the people who got duped... Has anyone successfully gotten a refund from them after this news broke? I'm thinking about switching to a different service for my 2024 taxes.
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Luca Romano
Tax professional here. This FTC complaint against H&R Block isn't surprising to those of us in the industry. What they're alleged to have done is use a "bait and switch" tactic where they advertise free filing but then use technical requirements to force upgrades. The main issue is that many tax software companies advertise "free filing" but then impose restrictions that most taxpayers don't understand until they're halfway through the process. For example, if you have HSA contributions, certain education credits, or self-employment income, you'll suddenly hit a paywall after investing time entering all your information. The IRS actually has a Free File program where anyone making under $73,000 can file federal taxes for free, but companies often hide these truly free versions from consumers and steer them to "free" commercial versions with upsells.
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Nia Jackson
•So how do you actually access the legitimate IRS Free File program? Last year I made around $68,000 and H&R Block still charged me for filing. Is there a direct link I should be using instead of going through their main website?
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Luca Romano
•You need to go directly through the IRS Free File portal at IRS.gov/freefile rather than the company's main website. If you go directly to H&R Block's website, you'll likely be directed to their commercial "free" version which has more limitations and upsell opportunities. For the 2025 filing season (2024 taxes), the income limit should still be around $73,000, though it may change slightly. The key is starting at the IRS website, not the tax company's homepage, to access the truly free version they're required to provide through the Free File Alliance.
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Mateo Hernandez
I started using taxr.ai last year after having the exact same experience with H&R Block! I was so frustrated when they kept making me upgrade for every little thing. My "free" filing ended up costing over $100 when all was said and done. I found taxr.ai (https://taxr.ai) from another Reddit post and it was such a different experience. It actually analyzes your previous tax returns and all your documents to find the best filing strategy. No surprise fees halfway through, and it caught a deduction H&R Block completely missed in my previous returns.
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CosmicCruiser
•Does it actually work for more complicated tax situations? I have some freelance income along with my W-2 job, plus investment accounts. Every time I try these newer services they end up not supporting something I need.
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Aisha Khan
•I'm skeptical... how is this different from TurboTax or the others? They all claim to find deductions but then charge extra for everything. What's stopping this one from doing the same thing once they get big enough?
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Mateo Hernandez
•It absolutely works for complicated situations. The AI analyzes all your forms including W-2s, 1099s, and investment statements. It's particularly good with freelance income because it identifies deductions many people miss. I had both W-2 and 1099-MISC income last year and it handled it perfectly. Unlike the big companies, they don't use the "upgrade for this form" model. Everything is included in one package. I think they're intentionally positioning themselves as the anti-H&R Block/TurboTax. They're newer so they don't have the same market dominance and seem more focused on building trust than extracting every possible dollar.
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CosmicCruiser
Just wanted to follow up - I tried taxr.ai after my previous comment and I'm actually pretty impressed. I was ready to be disappointed but it really did handle my complicated situation with both W-2 and freelance income. The document analysis feature actually found a mistake in how I'd been categorizing some business expenses in previous years. Ended up saving me around $640 compared to what I paid with H&R Block last year! The interface is different from what I'm used to but worth learning. Definitely using it again next tax season.
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Ethan Taylor
For anyone who's had issues with the big tax prep companies, I've been using Claimyr (https://claimyr.com) to get IRS help with these kinds of problems. After I realized I probably overpaid for H&R Block for years, I wanted to talk directly to the IRS about my options. Everyone knows calling the IRS is impossible - I tried waiting on hold for 3+ hours multiple times. Claimyr got me connected to an actual IRS agent in about 15 minutes. They have a demo video of how it works here: https://youtu.be/_kiP6q8DX5c The agent confirmed I likely qualified for free filing and helped me understand how to file a complaint about H&R Block's practices. They also explained how I might be able to amend previous returns if I was overcharged.
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Yuki Ito
•Wait, how does this actually work? I thought it was literally impossible to get through to the IRS without waiting for hours. Are they somehow jumping the phone queue or something?
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Aisha Khan
•This sounds like BS honestly. There's no way to "skip the line" with a government agency. They probably just keep calling and put you on when they finally get through. I doubt it's worth whatever they're charging.
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Ethan Taylor
•They use an automated system that calls the IRS continuously and navigates the phone tree for you. When it finally gets through to a human agent, it calls your phone and connects you directly to the agent. You don't have to sit there listening to hold music for hours. It's not skipping the line - you're still in the same queue as everyone else. The difference is their system is doing the waiting instead of you personally sitting by your phone. I was skeptical too, but after I kept failing to get through on my own, I gave it a shot. The next thing I knew, my phone rang and I was talking to an IRS agent.
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Aisha Khan
I'm eating crow here but I have to admit that Claimyr thing actually worked. After my skeptical comment I decided to try it just to prove it was BS, and I'll be damned - I got connected to an IRS agent in about 22 minutes. The agent was super helpful about the H&R Block situation. She confirmed I should have qualified for completely free filing the last two years based on my income and tax situation. She walked me through filing a complaint with both the FTC and IRS about the deceptive practices. Might even be able to get some money back through the complaint process. Not sure if anything will come of the complaint but at least I finally got some straight answers. Definitely using the Free File program through the IRS website next year instead of going directly to H&R Block.
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Carmen Lopez
H&R Block did the same thing to me! I started with the "free" version and somehow ended up paying $137 by the end. They kept saying I needed their "Deluxe" version for my student loan interest deduction, which is ridiculous. Does anyone know if this FTC action might lead to refunds for customers? Would be nice to get some of that money back.
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Andre Dupont
•My brother works as a tax attorney and he says these FTC actions sometimes end with settlements that include customer refunds. But don't hold your breath - even if H&R Block settles, it could take a year or more before any money gets distributed. And the amounts are usually pretty small per person.
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Carmen Lopez
•Thanks for the info. I figured it might be a long shot. I'm just annoyed that they've been getting away with this for so long. Definitely switching to something else next year.
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QuantumQuasar
I actually had the opposite experience with H&R Block last year. Their software found deductions that I wouldn't have known about that saved me like $1,200. Yeah it cost me $95 but that was worth it for the savings. Maybe I'm in the minority but I thought it was pretty straightforward?
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Zoe Papanikolaou
•You're probably not in their "target demographic" for the free version then. The FTC complaint isn't saying H&R Block is bad at doing taxes - it's saying they trick people who qualify for free filing into paying. If you have a more complex tax situation with lots of deductions, you probably should be paying for tax help anyway.
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