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Discussion:H&R Block, disclosing "cross-collection," and other info for first-year preparers.

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Discussion Forum Index --> Business Growth Community --> H&R Block, disclosing "cross-collection," and other info for first-year preparers.


Jglover1978 (talk|edits) said:

29 December 2009
I have several years experience at Block. My goal here, and for all of us, is to give first-year preparers the best information we can. And I invite other people to jump in and help.

Okay, first off, cross-collection, you have to become somewhat familiar with it and disclose it to your clients in a meaningful way, that's the only ethical way to do it. And it need not take all that much time. In fact, I'd argue that a brief explanation and/or a brief conversation is often more meaningful than something overly long and complicated.

Okay, next part, the more experienced tax pros, they do and they don't want to help you, it's a complicated thing. It's like they run out of steam. And really, you are slowing them down and lowering the chance of them getting a commission. And they're thinking the company should have trained new hires better, perhaps true, but why are they taking it out on you! And there's also a dynamic, and I wish this wasn't the case, of people blurring together and it's no longer you specifically Jeff or you specifically Sally, it's the category "another first-year person." However, that leaves an opening, if you can differentiate yourself . . . So, I might suggest this. The second time you ask for help from experienced pro Stanley in live time, with a real live client sitting at your desk, and after he or she graciously helps you, maybe briefly say something along these lines: "Stanley, thank you. And you know I'll only ask for help when I really need it." That personalizes it, it lets him know that you appreciate his time and effort, and that you’ll only ask for help when you really need it, and so when you do ask for help down the road, he or she will be more likely to take time to help you, and less likely to delay . . delay . . delay.

I am trying to give it to you straight. The experienced people are very helpful at the beginning, and then, it's not even a gradual erosion, just suddenly they're doing their own stuff and, Wow, they really do just brush you off. And I couldn’t believe it was something as junior high as a person saying give me a minute, as if they’re going to be over in a minute or two, when apparently they had no intention of coming over to help. And it puts you in a very embarrassing position of sitting at your desk with your client, waiting for them to come over. It bothered other new preparers considerably more than it bothered me. And it was kind of like they said it, they put it in words, so I didn't need to. And I think I got lucky. I think because of my interest in business and Sch C, I hit it right, mainly just by sheer luck. We were all trying to strike a happy medium between not taking on returns too hard and continuing to grow, and that I quickly saw that Sch C could spiral to a lot of complexity, including from the Block training class. “We might need to put it on hold”<---I quickly hit upon that, and saying that when they brought up the business, and that helped a lot.

So, good luck to everyone this season. Learn a whole lot, have a lot of fun. And please jump in here and contribute if you’d like.

Jglover1978 (talk|edits) said:

29 December 2009
The following is the lead court case regarding cross-collection that I am aware of. It involves Jackson Hewitt, but of course Block, JH, Liberty Tax are very similar businesses (in fact, Liberty was even founded by a Mr. Hewitt!)

Hood v. Santa Barbara Bank & Trust (2006) , Cal.App.4th http://fsnews.findlaw.com/cases/ca/caapp4th/slip/2006/b184489.html

Jglover1978 (talk|edits) said:

29 December 2009
CANIEVA HOOD et al., Plaintiffs and Appellants, v. SANTA BARBARA BANK & TRUST et al., Defendants and Respondents.
“  .  .  .  Santa Barbara denied Hood's loan application because a third party bank claimed that she owed it money for a preexisting RAL. After the IRS deposited Hood's 2001 refund into the Santa Barbara account, Santa Barbara paid it to the third party bank.  .  .  ”

http://fsnews.findlaw.com/cases/ca/caapp4th/slip/2006/b184489.html

Jglover1978 (talk|edits) said:

29 December 2009
H&R Block has more angry customers than any business I've ever observed, much less worked at! (a complaint counter at American Airlines being a somewhat distant second)

The overwhelming majority of the complaints is that the client has not received the loan when he or she has a perfectly good return, and has not been given a straight story either at the time of first visit or subsequently.

Cross-collection is rare. I previously put it at 1 out of 100. It might even be 1 out of 200. It's like a surgical procedure that would seem safe, but leads to the death of the patient 1 out of 100 times. As awkward, repetitive, nuissance, that conversation is likely to be, including for the 99 patients who will have no problem whatsoever, you have got to have it. Each and every time.

Jglover1978 (talk|edits) said:

25 January 2010
The California Attorney General sued H&R Block in Feb. 2006:

“ . . . COMPLAINT FOR INJUNCTION, CIVIL PENALTIES AND OTHER RELIEF . . . "
" . . . The RAL or RAC forms do not specify that the partner bank is a debt collector, but do state that the partner bank may be acting as a debt collector. . . [page 9]”
http://ag.ca.gov/newsalerts/cms06/06-013_0a.pdf


See also the Office of the Attorney General's news release, February 15, 2006. http://ag.ca.gov/newsalerts/release.php?id=1261

Jglover1978 (talk|edits) said:

25 January 2010
Again, the most common complaint is that the client doesn’t receive the loan---and doesn’t receive a straight answer.

http://consumeraffairs.com/finance/hr_block_ral.html

Cross-collection isn’t even on the radar screen. It should be.

FCGMinnesota (talk|edits) said:

26 January 2010
Thanks for the info jglover.

I'm planning to take the H&R tax course at the end of this year so I have the option of working with them next year. I'm currently studying for my CPA and expect to complete April/May.

I have no pratical experience at this point (just experience from studying for CPA and CFP). My question is how much should a first time tax preparer expect to earn thier first season at H&R.

Thanks!

Jglover1978 (talk|edits) said:

27 January 2010
You’re very welcome! I do try. I guess a fair number of people think of me as a radical, whereas I think of myself as being pretty moderate and factually-oriented. Okay, in answer to your question . . .

Thin.

My experience, very few employees get the bonus. And so the income is likely to be thin.
http://www.eastbayexpress.com/eastbay/a-workers-life-under-handr-block/Content?oid=1089343
(take it for what it’s worth, including the comments disagreeing with the writer).

I look at it like the World Series Of Poker! Now, it sounds like you have some snap. And I wish you all the best on your upcoming CPA. And I’m sure you’ll do well on the Block courses, and get fast on their software. All the same, you will need to catch some cards. You’ll need to have a number of returns that are theoretically difficult, but not really. That is, a number of returns that bill for extra forms, but that you can do quickly. (And on that point you’re helping the client for few people want to be sitting in that chair for anywhere approaching an hour, and on some tax prep/bank product sessions, it ends up going considerably longer than that.)

So, most likely, you will get $9 or $10 an hour (just like most years Phil Hellmuth does NOT cash in the Main Event, no question he has the skills, he just doesn’t catch the cards).

You will get experience and face-to-face interaction with clients.

PatrickA5 (talk|edits) said:

27 January 2010
In my area, HRB first year preparers make $10 an hour (no commission). I keep telling myself I'm doing it for the experience, but even that isn't working out as I have to be in the slowest office in the US. I'll be thrilled if I even make it to 25 returns. But, I'm banging out all of the online training I can get and plan on taking every live course offered this summer/fall. Next year (if I stay at HRB), I'll ask to be moved to a busier office.

Ksnoopytax (talk|edits) said:

27 January 2010
For a second I thought this was about cross collection between government agencies for items like child support. I don't remember this but I worked there about 10 years ago. That sucks for those who were hoping for a refund check and instead it goes to a debt collector. Fine with me though because I wouldn't want those clients anyways.

Jglover1978 (talk|edits) said:

27 January 2010
Well, with today’s economy, plenty of good people have debt issues. And we have still got to let people know.

Jglover1978 (talk|edits) said:

27 January 2010
National Taxpayer Advocate’s
2007 Objectives Report to Congress
Volume II
The Role Of The IRS In The Refund
Anticipation Loan Industry


“ . . . Accordingly, with cross-collection, it is unclear whether the taxpayer had a reasonable opportunity to dispute the existence or amount of the debt before the third party bank collects it from the taxpayer’s refund. . . ” (page 11)

http://www.irs.gov/pub/irs-utl/2007_objectives_report_vol_ii_ral_final.pdf

Jglover1978 (talk|edits) said:

27 January 2010
I am not doing taxes this year.

And even though I draw a distinction in that I consider my loyalty to be with my co-workers and my clients, and not with the company hierarchy---and even though I don’t criticize executives and managers by name, that would be something you’d really want to ask yourself a second and in fact a third and fourth time if it was really necessary (private conversations, perhaps, depending on circumstances; publicly on the Internet, probably not), but the policies of a large corporation, that’s something you can talk about til the cows come home.

But still, all the same, I could not speak this freely if I was!

Jglover1978 (talk|edits) said:

27 January 2010
Last year, for 2009, new preparers seemed to get around $10 an hour (maybe some bouncing around).

Experienced people seemed to often get somewhat less, their pay being tailed back due to not making the unrealistic bonuses.

Some people work off the clock in an attempt to build up their bonuses. This is against the rules. In fact, in a large meeting, one of the managers basically said that it was a fire-able offense. And besides, why turn down a sure thing, and pay you have earned, and even if there aren’t clients, you are available, for a delayed and uncertain bonus?

Jglover1978 (talk|edits) said:

27 January 2010
about more hours and more clients

I wonder if you could ask your district manager (and maybe run it past your office manager first) for more hours and let he or she know that you’d be happy to work at another office in addition to your first office?

The only thing, the district managers are often stretched very thin. There seems to be so many tasks that the managers have to do on their own computers or with their own passwords, that they cannot delegate (or just to a single trusted assistant), but they can’t delegate broadly and in the natural flow of activities.

I remember last year a manager yelling, “The experienced people are the problem!” And for last year, the managers seemed to be judged almost entirely by their numbers on “Second Look”---a $29 add-on which hardly any of the experienced preparers were interested in it (true enough), nor many of the new preparers. It was as if McDonalds managers were to be judged entirely on their numbers for the introduction of a new dessert item, and no longer had any incentives to do well in running the rest of the business!

But feel it out, your manager might be thoroughly reasonable, and he or she might welcome someone willing to travel to a busier office.

And keep your eyes open, besides taxes, you just might learn a whole lot about business! (But do not forget, H&R Block is extremely strong on the marketing side, and that is not to be lightly dismissed.)

+++++

And, I would be interested in how you made the computer modules interesting. I tried various methods of skimming, as well as various methods of going in-depth and note-taking, and I didn’t seem to find a good rhythm.

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