H&R Block
 | |
| Company type | Public (NYSE: HRB) |
|---|---|
| Founded | Kansas City, Missouri, U.S. (1955) |
| Headquarters | Kansas City, Missouri, U.S. |
Key people | Russ Symth CEO; Becky S. Shulman, CFO; Richard Breeden, Chairman; Henry and Richard Bloch, Founders |
| Products | Banking Business Services Tax Preparation Investments |
| Revenue |  $4.4 billion USD (2008) |
 $(308.6) million USD (2008) | |
| Website | www.hrblock.com |
H&R Block (NYSE: HRB) is a tax preparation company in the United States, claiming more than 22 million customers worldwide, with offices in Canada, Australia and the United Kingdom. The Kansas City-based company also offers banking, personal finance and business consulting services.
Founded in 1955 by brothers Henry W. Bloch and Richard Bloch, Block today operates 12,500 retail tax offices in the United States, plus another 1,400 abroad. In addition to Block's retail stores, they offer their own consumer tax software called H&R Block at Home (formerly TaxCut), as well as online tax preparation and electronic filing from their website.
In fiscal year 2007, Block reported revenue of $4 billion and net income of $374.3 million.[1] The company was ranked 467 in the Forbes 500 list of top U.S. companies in 2006.[2] In mid-2007, Block had market capitalization of $6.45 billion.[3]
By early 2008, Block's market capitalization decreased to $6.06 billion, and the company was ranked number 1461 in the Forbes Global 2000.[4] In the fiscal year ending April 30, 2008, Block reported revenues of $4.4 billion and a net loss of $308.6 million.[5]
History
During World War II, Henry Bloch was a young Army Air Forces navigator who wanted to start a family business with his brothers in Kansas City. Home from the war in 1946, Henry saw a pamphlet suggesting a bright future for companies serving small businesses, and it fired his imagination. That year, Henry and his older brother, Leon, borrowed $5,000 and opened a small bookkeeping business on Main Street in downtown Kansas City. However, four months later, they had few clients and Leon decided to seek a law degree.
Henry wanted to keep trying with the fledgling business and placed a newspaper ad for help-wanted. He got an unexpected response—from his mother—who proposed that Henry hire his younger brother, Richard, for the job. Henry and Richard Bloch jointly ran their United Business Company, which focused on bookkeeping, but also did some income tax work for clients. The brothers found that doing taxes was time-consuming, and they decided to end that type of service. One of their clients, John White, an ad salesman for The Kansas City Star newspaper, had a different idea; he suggested the Blochs make tax preparation a separate business and developed an ad announcing $5 tax services. The Blochs were not convinced, but they agreed to run the ad in January 1955. The next day, the brothers had an office full of tax clients, and H&R Block was born.[6]
In 1956, the Blochs decided to expand and picked New York City. The move was profitable, but neither brother wanted to move to New York, so they agreed to sell that regional operation to two local accountants. However, since the would-be buyers could not meet the asking price, the parties agreed the Bloch brothers would get $10,000, plus royalties from the tax operation, creating the first H&R Block franchise tax office. The Bloch brothers chose to spell the name "Block" with a K to ensure the name is not mispronounced "blotch."[7] In the following years, H&R Block grew quickly and went public in 1962, then opened its first tax training school in 1965 to meet the demand for skilled tax professionals at its franchise offices.
A TV ad campaign begun in 1972 featured Henry Bloch and became the springboard for H&R Block becoming one of the most widely recognized brand names in the U.S.
By 1986, Block was handling more than 10 million tax returns each year and had opened offices in Canada and Australia. That year, Block worked with the Internal Revenue Service to introduce electronic filing. Since then, Block has moved further into the digital realm with tax software and online tax preparation. Beginning in the 1990s, the company began to expand into the financial services arena, offering mortgage loans, banking, and business services.
Business areas
Retail tax services
In May 2007, the company said its total U.S. clients served during the 2007 tax season reached a record 19.9 million, up 3.8 percent from the previous year period.[8] H&R Block employs 90,000 tax preparers. The company reported that in 2007, its tax clients obtained US$30 billion in tax refunds, credits and other government benefits. The company said it filed US$10 billion worth of Earned Income Tax Credits for its low-income clients.
Digital tax services
H&R Block competes for a share of the digital market with its online tax programs and software. Block's other digital offerings include H&R Block Signature, where clients enter their information and do their returns online and a Block tax professional reviews, edits, signs and e-files the return; and, Block Online Office, where clients enter their information on a questionnaire, submit it online and a Block preparer works up their tax return and files it. Similarly, TaxOne is a program where outside businesses may contract H&R Block to prepare taxes for their clients. H&R Block provides free digital tax services to low-income families through a web portal called the Beehive.[9]
H&R Block Bank
The H&R Block Bank was chartered in 2006 and offers low-cost services to its low- to moderate-income customers. Block has said that more than one-third of its clients have no banking services, and must pay high check-cashing fees for their paychecks, as well as tax refund checks. Bank customers can establish FDIC-insured accounts with their tax refund money and then access those funds with pre-paid "Emerald" Mastercards through a nationwide network of ATMs. The accounts also allow direct payroll deposits and clients can get traditional services, such as home mortgage loans, lines of credit, and IRAs. Block Bank accounts are available only to the company's tax clients in Block offices. The bank is primarily an online operation, with one brick-and-mortar office located in Kansas City.[10]
RSM McGladrey
RSM McGladrey Business Solutions was created in 1999 when H&R Block acquired the assets and business of McGladrey & Pullen, based in Bloomington, Minnesota. McGladrey has 100 offices in 25 states and offers accounting, consulting, tax services, and international business services to mid-sized companies. Its clients include business in the construction, health care and manufacturing industries. Through an alliance with McGladrey & Pullen and other accountancies, the Block subsidiary operates in 70 countries under the RSM International name. RSM has an alternative practice structure with McGladrey & Pullen.[11]
Products
- H&R Block At Home - a tax preparation program formerly called TaxCut. Either the online or CD versions will prepare and file one's tax return with the IRS with the option to e-file and direct deposit an applicable tax refund into a specified bank account.[12]
See also
References
- ^ Associated Press
- ^ CNN Money
- ^ Yahoo! Finance
- ^ Forbes Global 2000
- ^ H&R Block Press Center
- ^ Steve Koppman (April 16, 2008). "A Worker's Life Under H&R Block: Tax season is over and you know how much you're getting back. Some workers at H&R Block wish they could say that about their wages". East Bay Express.
- ^ http://findarticles.com/p/articles/mi_m1154/is_v75/ai_4722544/
- ^ MarketWatch Report
- ^ Official site of Beehive
- ^ Kansas City Business Journal
- ^ Hoover's Report
- ^ CNNMoney.com - Dec 11, 2009 - H&R Block Announces Agreement Between RSM McGladrey, Inc. and McGladrey & Pullen, LLP – [1]