by H&R Block is an unethical company. Straight Up. (And it feels good saying that!) And it's not just me saying that. Following is is a press release from the office of California Attorney General Bill Lockyer, Feb. 2006:
Attorney General Lockyer Files Lawsuit Against H&R Block for Illegally Marketing and Selling High-Cost Loans as 'Instant' Tax Refunds, February 15, 2006.
' . . . These applications are denied, and the customer's anticipated refund is used to pay off the debt, plus a fee. "Therefore, Block clients who are claimed to owe debt from a prior year are led to expect a loan, but instead find themselves in a collection proceeding," the complaint alleges. . . ' [second to last paragraph]
http://oag.ca.gov/news/press_release?id=1261
And following is a publication from the IRS Taxpayer Advocate:
National Taxpayer Advocate’s
2007 Objectives Report to Congress
Volume II
The Role Of The IRS In The Refund
Anticipation Loan Industry
June 30, 2006.
' . . . It is also interesting to note that federal law prohibits banks from exercising their right to offset Social Security benefits for the recipients’ defaulted loans to that bank. It would make sense to protect EITC funds in a similar manner. At the very least, banks should be barred from transferring EITC under a cross-collection arrangement to satisfy a debt owed to a third party bank. . . ' [bottom of page 11 and top of page 12]
http://www.irs.gov/pub/irs-utl/2007_obj ... _final.pdf
Okay, any product advertised as "Rapid Refund" or "Money Now" is a loan product. With high interest. Yes, but that is perhaps the least damaging part of it! Kind of like lava is perhaps the least dangerous aspect of a volcano.
There are flat fees such as "account fees" and "check fees." There are also inflated prices for the tax preparation, including for Earned Income Tax Credit (EITC) and Additional Child Tax Credit.
And then this is "cross-collection," also benignly called "debt offset" or "repaying debt." This is what the California Attorney General and the IRS Taxpayer Advocate are alluding to. I do not want to oversell this. This perhaps only happens with 1 out of 100 clients, maybe even somewhat fewer. But it is an absolute body blow when it happens. What this means is that the bank takes all the money. The bank takes the client's entire refund. When the customer applies for the loan, they are directing the IRS to deposit their refund with the bank. Also, if the tax prep is taken out of the refund, the only way to do that is to first direct the money to a bank account. And if the bank is going to "cross-collect," they will use this opportunity to do so.
Now, the IRS does collect for such things as child support and student loans. The bank does so for bank debt. The two above references talk about old unpaid Refund Anticipation Loans (RAL), but the actual paperwork the client is asked to sign--Wow, it is scary broad.
But if it worked out okay the previous year, and if the client really needs the money now . . .
So, the important thing is to have a real conversation with the client, not try and decide for the client.
I might say, It is a loan application . . . as soon as the client brings up anything about getting their money quickly.
I might say, For this year [2011], the IRS will no longer be providing something called the 'debt indicator.' So it might be that fewer loans are approved this year.
And for the part of the loan/bank product application that has the scary language, if I had to do it all over again, I think I would underline it in blue ink as I hand it to the client, and do so without saying a word. As if I'm required to do so by the company. And give the client a chance to initiate a conversation if he or she wants to. (What I actually did was overtalk and overexplain.)
Of course, I'm not required to do so by the company. They actually don't want you to bring up any of these "problems."
And I think it's clearly better for me to be there, than not be there.
But a little bit, been there, done that. An awful lot of gear-up for what is usually a five week season. And no, first year people hardly ever get the bonus. http://www.eastbayexpress.com/eastbay/a ... id=1089343 Even for later year people, it's real dicey. A lot of good people don't get the bonus, including fast and efficient people.
But it's not your job to rain on someone else's parade. Some employees really like the idea of getting both an hourly wage plus commission. I really like that idea. It's just a shame H&R Block doesn't really come through.
Customers storm the store. The biggest complaint clients have is that they aren't approved for the loan when they have a perfectly good tax return, and aren't getting a clear answer why not. They're tired of the gobbledegook from the automated phone line, and so the client storms the store. Some days, zero angry customers, some days four or five. H&R Block has more angry customers than any other business I've ever seen! An American Airlines complaint desk was a somewhat distant second. One year I was fired for attempting to call customers proactively who weren't approved. They said it was for a different reason, but that was the real reason. But, since it's usually only five weeks anyway and you don't get the bonus, you might as well be ethical! [I did not work in 2011, but that is the first year the IRS stopped the 'debt indicator.' So I really wonder how many angry clients.]
--------------------------------------------
But the good part, H&R Block convinced me that I would be a pretty good doctor. I am now 48 years old. If I were a younger man, Yes, I would seriously consider medical school. I do sometimes think about medical journalism.
I found that I was a better than average tax preparer. I felt clients were lucky when they got me.
I am a nerdy guy. I tend to have patchy social skills, better than average in some areas, and below average in other (and sometimes that very aspect of patchiness throws people off). But when I casually jot notes of what I might ask or might say, either in a personal journal or as casual notes in margins of printed tax material, I find I often do pretty well. And I also usually do somewhat better in a more formalistic setting.
H&R Block offers people the chance to have real live face-to-face interactions with real live clients when the employee is as young as, I think, 18 years old. (They don't pay you like it's a professional interaction, but for the welfare of the client's life and the respect the client is due, it is a professional interaction.) The hourly wage is $9 or $10 an hour, but you get real client experience.
For example, in a medical setting, influenza is usually no big deal, but occasionally it can cause either direct viral pneumonia or secondary bacterial pneumonia, so if I were a doctor giving a patient a prescription of Tamiflu I might say, "Okay, this should help. Now, this is important, if you relapse with high fever or if you start to have any trouble breathing, give me a call right away. Alright?"
It's not about a virtuoso performance. It's more ping-ponging back and forth with brief statements. It's about being open to appreciating the client, which may or may not happen. But you can be courteous, respectful, and communicative even if it doesn't.
If you are under 30 years of age, I think it is a gift to oneself to even to consider medical school.
Attorney General Lockyer Files Lawsuit Against H&R Block for Illegally Marketing and Selling High-Cost Loans as 'Instant' Tax Refunds, February 15, 2006.
' . . . These applications are denied, and the customer's anticipated refund is used to pay off the debt, plus a fee. "Therefore, Block clients who are claimed to owe debt from a prior year are led to expect a loan, but instead find themselves in a collection proceeding," the complaint alleges. . . ' [second to last paragraph]
http://oag.ca.gov/news/press_release?id=1261
And following is a publication from the IRS Taxpayer Advocate:
National Taxpayer Advocate’s
2007 Objectives Report to Congress
Volume II
The Role Of The IRS In The Refund
Anticipation Loan Industry
June 30, 2006.
' . . . It is also interesting to note that federal law prohibits banks from exercising their right to offset Social Security benefits for the recipients’ defaulted loans to that bank. It would make sense to protect EITC funds in a similar manner. At the very least, banks should be barred from transferring EITC under a cross-collection arrangement to satisfy a debt owed to a third party bank. . . ' [bottom of page 11 and top of page 12]
http://www.irs.gov/pub/irs-utl/2007_obj ... _final.pdf
Okay, any product advertised as "Rapid Refund" or "Money Now" is a loan product. With high interest. Yes, but that is perhaps the least damaging part of it! Kind of like lava is perhaps the least dangerous aspect of a volcano.
There are flat fees such as "account fees" and "check fees." There are also inflated prices for the tax preparation, including for Earned Income Tax Credit (EITC) and Additional Child Tax Credit.
And then this is "cross-collection," also benignly called "debt offset" or "repaying debt." This is what the California Attorney General and the IRS Taxpayer Advocate are alluding to. I do not want to oversell this. This perhaps only happens with 1 out of 100 clients, maybe even somewhat fewer. But it is an absolute body blow when it happens. What this means is that the bank takes all the money. The bank takes the client's entire refund. When the customer applies for the loan, they are directing the IRS to deposit their refund with the bank. Also, if the tax prep is taken out of the refund, the only way to do that is to first direct the money to a bank account. And if the bank is going to "cross-collect," they will use this opportunity to do so.
Now, the IRS does collect for such things as child support and student loans. The bank does so for bank debt. The two above references talk about old unpaid Refund Anticipation Loans (RAL), but the actual paperwork the client is asked to sign--Wow, it is scary broad.
But if it worked out okay the previous year, and if the client really needs the money now . . .
So, the important thing is to have a real conversation with the client, not try and decide for the client.
I might say, It is a loan application . . . as soon as the client brings up anything about getting their money quickly.
I might say, For this year [2011], the IRS will no longer be providing something called the 'debt indicator.' So it might be that fewer loans are approved this year.
And for the part of the loan/bank product application that has the scary language, if I had to do it all over again, I think I would underline it in blue ink as I hand it to the client, and do so without saying a word. As if I'm required to do so by the company. And give the client a chance to initiate a conversation if he or she wants to. (What I actually did was overtalk and overexplain.)
Of course, I'm not required to do so by the company. They actually don't want you to bring up any of these "problems."
And I think it's clearly better for me to be there, than not be there.
But a little bit, been there, done that. An awful lot of gear-up for what is usually a five week season. And no, first year people hardly ever get the bonus. http://www.eastbayexpress.com/eastbay/a ... id=1089343 Even for later year people, it's real dicey. A lot of good people don't get the bonus, including fast and efficient people.
But it's not your job to rain on someone else's parade. Some employees really like the idea of getting both an hourly wage plus commission. I really like that idea. It's just a shame H&R Block doesn't really come through.
Customers storm the store. The biggest complaint clients have is that they aren't approved for the loan when they have a perfectly good tax return, and aren't getting a clear answer why not. They're tired of the gobbledegook from the automated phone line, and so the client storms the store. Some days, zero angry customers, some days four or five. H&R Block has more angry customers than any other business I've ever seen! An American Airlines complaint desk was a somewhat distant second. One year I was fired for attempting to call customers proactively who weren't approved. They said it was for a different reason, but that was the real reason. But, since it's usually only five weeks anyway and you don't get the bonus, you might as well be ethical! [I did not work in 2011, but that is the first year the IRS stopped the 'debt indicator.' So I really wonder how many angry clients.]
--------------------------------------------
But the good part, H&R Block convinced me that I would be a pretty good doctor. I am now 48 years old. If I were a younger man, Yes, I would seriously consider medical school. I do sometimes think about medical journalism.
I found that I was a better than average tax preparer. I felt clients were lucky when they got me.
I am a nerdy guy. I tend to have patchy social skills, better than average in some areas, and below average in other (and sometimes that very aspect of patchiness throws people off). But when I casually jot notes of what I might ask or might say, either in a personal journal or as casual notes in margins of printed tax material, I find I often do pretty well. And I also usually do somewhat better in a more formalistic setting.
H&R Block offers people the chance to have real live face-to-face interactions with real live clients when the employee is as young as, I think, 18 years old. (They don't pay you like it's a professional interaction, but for the welfare of the client's life and the respect the client is due, it is a professional interaction.) The hourly wage is $9 or $10 an hour, but you get real client experience.
For example, in a medical setting, influenza is usually no big deal, but occasionally it can cause either direct viral pneumonia or secondary bacterial pneumonia, so if I were a doctor giving a patient a prescription of Tamiflu I might say, "Okay, this should help. Now, this is important, if you relapse with high fever or if you start to have any trouble breathing, give me a call right away. Alright?"
It's not about a virtuoso performance. It's more ping-ponging back and forth with brief statements. It's about being open to appreciating the client, which may or may not happen. But you can be courteous, respectful, and communicative even if it doesn't.
If you are under 30 years of age, I think it is a gift to oneself to even to consider medical school.