Just for fun

I was reading complaints on a so-called "consumer affairs" site about H&R Block.  I looked around and found many of the complaints raised the same themes.  Then I checked the complaints filed against other major tax preparation firms.  Same themes. 

Then I looked at the complaints for TurboTax.  There were even more of those and most of these dealt with horrific customer service for those who tried to use the support phone lines/chats that they advertise in those commercials as being staffed only by CPAs or EAs.

I started to cut and paste, and then address some of the complaints but that's not a smart idea.  I don't want to embarass anyone in particular over their complaint, especially since they believe it is legitimate.  So I'm going to take some of the more popular ones that kept showing up and discuss them.

It shouldn't cost so much, my return is really quite simple.

If it is that simple, why aren't you doing it yourself?  You perceive it as simple because an expert (usually) is taking the information you provide and entering it properly into the right places in a piece of complicated software.  Retired people who have pensions, Social Security and other income do not have simple returns.  There's a calculation that has to be made to determine how much, if any, of their Social Security income is subject to being taxed.  If they have a pension, it might be one where a return of investment is involved, so the amount of the payout for the year that is not taxable has to be calculated.  If someone took an early distribution from their IRA, there are exceptions to the early withdrawal penalty that must be explored to avoid paying a penalty that isn't really owed.  It usually turns out that it wasn't that simple.

They said I could file for free if I came in before this date.

What they said was that you could file for free if you qualified to file the simplest form, the 1040EZ.  That applies only to people who have no dependents who have only wages, salaries or tips, taxable interest, and unemployment income.  The only credit available is the Earned Income Credit for single people.  If the taxpayer has an education credit, a student loan interest credit or any other credit they qualify for, they can't file the 1040EZ.  Well they can, but they will lose that credit.

They wouldn't quote me a price.

You wouldn't let someone repair your car without an estimate in advance.  Nor would you get an exacte quote because they won't know every single thing that will need to be fixed until they pop the hood and get to work.  Taxes are no different.  I can't tell you how many times someone has called me up, told me their return was easy, just 1 W-2 and nothing else and then they show up with fifteen other tax forms, a box of receipts for expenses they want to deduct and then they're upset because the price we discussed on the phone is nowhere near the actual cost.  Every form prepared means a change in the bottom line.  It may be a change in their benefit, it may be a change to their detriment.  But all income and expenses have to be reported and claimed.

The fee was almost all of my refund.

There is absolutely no connection or correlation between the cost of tax preparation and the amount of the refund.  To think there should be is illogical.  Several years back (it was 2006 actually) I did a new client's return.  He made a lot of money but had no retirement plan through his job.  He'd made IRA contributions every year going back at least ten years.  He thought they were Roth IRA contributions, which don't change your tax liability in the year you put the money in.  I checked the paperwork and his IRA was actually a traditional one.  He was entitled to have reduced his taxable income in each of those years.  We could go only go back and amend three years worth of federal returns (we did a 4th for California only).  Between federal and state, he got back roughly 31% of the $12,000 in IRA deductions we were able to add to his returns.  That's a refund of more than $4,000.  So should I have charged him more because the refund was larger?  A few years before that, I found an error on a return done by a CPA that I ended up amending for the client and it got him back more than $15,000.  So should I have charged him more because I saved him that much money?  If you say no, then you must agree that someone's fee shouldn't be lowered just because their refund is small.

The online services do all the same things you do for a lower price.

Really?  Go do your taxes on one of those online services (aside from H&R Block) and then see how much help you get responding to a letter from the IRS.  I can't speak for the other big retail tax preparation companies but we're there year-round.  Maybe not on Christmas Day or New Year's Day, but 12 months of the year, there's at least one office open in every single district.  Some districts have more than one year-round office.  Take your IRS letter there and you will get free assistance in understanding and responding to it (if you're a client of H&R Block that is, otherwise there's a fee).

Some of the software programs do some planning for the future.  They may advise you that your child tax credit is going away next year because your kid will turn 17.  They may or may not let you know that when your kid reaches a certain age, they have to be a full-time student to remain your dependent for tax purposes.  You can't ask them what your options are when you leave your job and cash out your 401(k). 

When you have a large balance owing, or are getting a huge refund, they might advise you to change your withholding.  But they aren't going to fill out the W-4 form for you.  I do that for my clients.  They aren't going to call the IRS on your behalf and get income information to replace forms you lost (you have to be there when they do it, or sign a form that can be faxed to the IRS).  The online services can't look at your prior year returns to see if that CPA or other retail tax service cost you money by failing to claim a deduction you were entitled to.

The customer service was horrible.

It happens.  Just because you had a bad experience at one location doesn't mean all the people working there, or the people working at all locations are equally bad at serving clients.  Talk to the manager.  Talk to the district manager if that doesn't work.  If they don't know something is broken, they can't fix it.  But to disparage an entire national company because you had one really bad experience doesn't seem fair to me.  If I get bad service at one particular Olive Garden I'm not going to badmouth the entire chain.  If I get bad service from that location from more than one person, I'll stop going to that one.