Following over payment delays involving hundreds of thousands of incorrectly filed tax returns, Parker Waichman LLP, and co-counsel, just filed a class action lawsuit on behalf of consumers affected by H&R Block tax return errors.
The lawsuit alleges that H&R Block failed to fill out a mandatory field on Form 8863 that has delayed 600,000 tax refunds by as much as six weeks. The lawsuit was filed on March 29, 2013 in the U.S. District Court for the Northern District of Ohio, Eastern Division (Case No.1:13-cv-00698-CAB). H&R Block, Inc, HRB Tax Group, Inc., and HRB Technology LLC have been named as defendants.
“These individuals trusted and paid H&R Block to file their tax returns accurately so they could receive their refunds as soon as possible,” said Jordan L. Chaikin, a partner with national law firm, Parker Waichman LLP. “However, H&R Block has made an error that has delayed thousands of people from receiving their tax refunds on time. Furthermore, consumers paid this company under the promise of a 100 percent guarantee for their services, yet they have not been justly compensated for this error.”
The complaint states that the defendants erroneously and negligently prepared Form 8863, which was included with 600,000 tax returns. Because of this, the complaint alleges, tax refunds have been delayed up to six weeks beyond when they would have been paid and, among other issues, H&R Block has breached its contract. Also according to the allegations, H&R Block promised its customers a “100% Satisfaction Money Back Guarantee” which states that should a consumer be dissatisfied for any reason within 60 days, the consumer is entitled to a refund for the full purchase price. Despite this promise, the lawsuit alleges, H&R Block has failed to offer compensation to the plaintiffs or any other putative class members for the error caused solely by H&R Block and its subsidiaries.
The lawsuit points out that H&R Block did admit to its error on Form 8863, which led to the tax refund delay. Form 8863 is used to claim tax credits for qualified expenses paid to post-secondary education institutions, the complaint noted.
According to the lawsuit’s allegations and a report in the Kansas City Business Journal, H&R Block mistakenly left a mandatory field blank instead of answering “yes” or “no” for questions 22 through 26; this error, the lawsuit alleges, delayed the tax returns for plaintiffs and putative members in excess of the 21-day turnaround represented by the defendants.
Parker Waichman LLP filed the class action lawsuit alongside several other distinguished law firms: Climaco, Wilcox, Peca, Tarantino & Garofoli Co., LPA; Neblett, Beard & Arsenault; Holland Groves Schneller & Stolze, LLC; Levin, Fishbein, Sedran & Berman; and Geragos and Geragos APC.
In addition to long refund delays, which are hitting some filers hard, the delays are also creating issues in the way in which federal financial aid filings are processed, explained MarketWatch previously. In some cases, tax returns must not only be completed and filed, the IRS must verify the forms before students can finalize their financial aid packages. This delay has created hardships for some families struggling with children in college. The Department of Education did step in, said MarketWatch, notifying colleges about the issue and asking that schools award aid estimates based on financial aid from information. It is not clear which, if any, schools will move ahead with awarding aid based on unverified form information.