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JACKSON HEWITT Franchise Complaints

October 11, 2010

UnhappyFranchisee.Com – Are you familiar with the Jackson Hewitt tax franchise opportunity?  What do you think?  You’re invited to share a comment below.

According to the Jackson Hewitt website, Jackson Hewitt Tax Service Inc. (NYSE: JTX) is an industry leader providing full service individual federal and state income tax return preparation through more than 6,400 franchised and company-owned offices throughout the United States.

After its rapid rise to the #2 position in the industry, Jackson Hewitt has had some rough years and myriad problems.  According to Wikipedia:

“The 2007 Department of Justice investigation, poorly constructed financial products, and a company-wide tax law compliance initiative that many insiders believe did more harm than good combined to erase nearly 50% of the company’s market share over merely four years.

“Additionally, the company negotiated out of a default on its debt in May 2009 and technically defaulted for several days in May 2010 (though an agreement with creditors was announced within one week of the ‘default’).

“During the 2010 tax season, Jackson Hewitt was not able to provide its flagship refund anticipation loan product in 50% of its stores, placing it at a operational and marketing competitive disadvantage. The company’s current agreement with creditors requires that it secure refund anticipation loan funding adequate for 100% of its stores by September 30, 2010 and that written commitments from lending institutions be made available to creditors by November 15, 2010.  Failure to do either will place the company once more in default.

charts “Finally, in July 2010, the Internal Revenue Service announced its intention to discontinue the provision of the debt indicator to tax return preparers.

“The debt indicator is a significant part of the provision of refund anticipation loan funding and its lack of availability is expected to increase the cost of such products to consumers and decrease the level of their availability.

“This IRS change significantly reduces the probability that Jackson Hewitt will be able to comply with its renegotiated loan covenants as discussed above. The stock currently trades below one dollar*.”

* The Jackson Hewitt stock price is listed at $1.11 today

Unhappy Franchisee has received numerous complaints about the rival Liberty Tax Service (see LIBERTY TAX SERVICE Franchise Complaints).

Is Jackson Hewitt franchise have worse problems? 

How is the franchisor doing in helping Jackson Hewitt franchisees weather the storm of operational & marketing challenges, and adverse publicity?

Is this simply a franchise (Stock?  Tax preparer?) to avoid at all costs?

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

Company responses, clarifications or rebuttals welcome.  Contact the author/site admin at UnhappyFranchisee[at]gmail.com.

Comments

249 Responses to “JACKSON HEWITT Franchise Complaints”

  1. Don't Be Fooled says:

    Liberty keeps opening new locations because they run a world class SALES operation. They are in the business of selling franchises. From the first conference call with John Hewitt himself to the meet and greet in VB (with paid schills and the Tiger Woods’ of the tax business…just a few and even the EOT, it is all hype, fluff and a near cult-like group cheer leading session.

    I predict there will be lots more unhappy franchisees showing up on here about mid-March.

    Save your money and do it yourself, or find a different business. The low income tax customer that Liberty and Block and JH cater to will be harder to rip off without the availability of the RALs.

  2. bill says:

    Dont Be Fooled:

    Your comment about the cult-like group reminded me of my trip to VB. On the ride home from John Hewitt’s beach house I made a comment about drinking the cool-aide and another passenger in the car took exception to my comment. At the time I just thought he was just a weirdo but now I realize he was a plant. everything was staged. The store that they took us to was beautiful and the young lady who ran it was telling us how goods thing were. Two years later I’m at one of the trainings and she’s now a trainer they kept her in th fold but she lost her store. I only wish I was smart enought to see the hand written on the wall..

    Buyer beware!

  3. Frustrated and Disgusted says:

    Bill;

    I watched as the franchisee close to me had (3) wavers out on the street. I also looked in his store, no one around. And there hasn’t been for days. I wish him well, but also know how much his rent and overhead is, as I also looked at opening an independent store there. It’s only a matter of time.

  4. johnbarilla says:

    Where is Herb Maloney? Whatever happened to all jackson hewitt franchisees, are they independent now?

  5. mike says:

    Seibert,

    Herb is out.

  6. Stugotz says:

    Ok taxnerd….

  7. Stugotz says:

    Herb is now a very happy Liberty Tax franchisees…. His fees are up 77%!!!!

  8. Mike says:

    testaipira,

    Herb is not in the tax business….

  9. John Barilla says:

    Love how Mike knows everything. Jackson hewitt and HR blocks closing everywhere.. Liberty Tax popping up everywhere. Mom & Pops closing everywhere. Sound like an easy decision to me. My stores are up 83% this year. Loving it!!!

  10. Frustrated and Disgusted says:

    Re; John Barilla;

    My numbers are up too. My rent is $250/mo.for a great office and I am not paying JTH his obscene 19% for software. I should clear in excess of $75K this year at my one location, more than I could even dream of with Liberty. I guess we are all happy.

  11. John Barilla says:

    19% of your zero revenue is zero….

  12. Frustrated and Disgusted says:

    John;

    Actually revenue is good. Doing a lot more business and partnership tax returns, higher end tax returns, and very few EIC. Work 9-6 weekdays, did a few Saturday mornings during peak, and have gained some book keeping accounts to keep me through the after tax season. Hope you are doing well.

  13. johnbarilla says:

    So did the Jackson Hewitt franchisee have to buy themselves out of the franchise agreement to go as a mom and pop? Did the ones that did not renew have a non-compete. How did they get around that?

  14. Mike says:

    Jackson Hewitt is doing great, they are advertising everywhere, just like Block-Radio, Billboards etc. Hey wait, I saw a coupon for Liberty at a gas station last week for a free return. AWESOME!

  15. John Barilla says:

    Wow, so bankruptcy means everything is great. Growing 15% and doing some free returns means they are doing bad.. I don’t think you make it quite up to the second floor.

  16. Wait till the freer apps come out.

    Take your phone out, send the W2 and your REFUND is on it’s way.

  17. John Barilla says:

    I am still up 78% compared to last year in my main office….

  18. Mike says:

    Hewitt-loves them free returns!!

  19. testaipira says:

    Is anyone still buying franchises from this company? Are they still in business? Have not heard anything about them anymore

  20. ADMIN says:

    The Jackson Hewitt FDD which states that there were 5763 franchises in 2009, which dropped to 4846 by the end of 2011… a loss of 917. In 2011 almost 300 were terminated or didn’t renew.

    Company owned stores increased slightly from 1000 to 1110 during that time.

    There were 178 franchises and 98 company stores projected to open for the 2012 tax season.

  21. johnbarilla says:

    I miss Herb. He used to always have intelligent contributions to this site. Now we got Mike, Frustrated & Disturbed, Bill (all the same people as Taxnerd on yahoo) that add nothing. Whatever happened to Instant Tax and Roni Dutch?

  22. mike says:

    Awww, I miss Herb too…..:( IDIOT!!

  23. Trisha says:

    Hmm where is Marty Mazer and James Wheaton…and others through the ups and downs? Anyone miss them? Oh, I know who they work for now. Silly me. They were such an asset to Jackson Hewitt they are now owned by John Hewitt at Liberty very recently. Amazing things they shall do for Liberty. Amazing ballgame. I am sure they did not come begging John for a job after they fired John Hewitt from Jackson Hewitt, they know the story. Benchwarmers, firestarters and plants he left behind intentionally. Lots of watering and now the seeds have blown back over to Liberty Tax. Good ballgame. That will be his legacy, a hustler on American Greed or left lonely in a nursing home and broke. His girlfriends will likely keep his hidden money when he needs them most. That will be a shocker because I am certain he has a grip on that too which is why he does not need his family except for publicity of being a family man which they all deny privately. Don’t make me show the proof, don’t even test me. John Hewitt did get his legal intern pregnant, no names needed, after she filed sexual harassment on him. He has his ways to skate through everything in a pair of dirty tennis shoes and shorts.

    -Trisha

  24. johnbarilla says:

    Trisha, you sound like you were one of his girlfriends that got old and got traded for a new one. What is your point? Nobody cares if he was doing some young intern. Good for him!!!

  25. Trisha says:

    Actually I care and most women and men do if you know the history of what he does to people after he gets them vulnerable like a predator. To your ASSumptions once again…No, as I testified last month, John did not have intimate relations with me. I am one who buttons the top of my blouse. What is your point and why are you on all the tax prep complaint boards without a complaint except to the complainers? You have no steam to blow off and nothing to contribute as a solution or advice. You can’t and won’t prove your success and I don’t see why you probe very timely questions from the others during litigation and you also dare to ASSume as though it is fact to say people who are posting are all from the same member. I know for a fact different. Do you actually have a complaint to resolve on any of these boards?

  26. johnbarilla says:

    Just wondering if you kept the stained dress in your closet too? On a more serious note, looks like a bunch of new stores going to open this year and Jackson Hewitt and HR block closing even more. I would say getting closer and closer to being number 1 soon. I think there is about a year or two left to get in before this thing takes off. Trisha, remember to break the prozac’s in half.

  27. testaipira says:

    John,

    That was funny.. Trisha, did you keep the stained dress? Looks like Liberty is going to be adding a bunch of new franchisees this year while Jackson Hewitt and HR Block keep closing offices. I think Instant Tax is completely gone. Looks like Liberty will be bigger than HR block by 2020 after all. Trisha, tell the shrink to increase the dosage of your meds.

  28. Guest says:

    “That was funny…” Adolescent? Yes. Crude and defamatory? Definitely. Evidence of scumbaggery by an anonymous sleazer attacking someone with the guts to post with her real name? Most def.

    Only funny thing was the attempted comparison of John Hewitt, a man with a fan club of one (himself) to Bill Clinton, a man beloved and respected by millions. THAT’S funny.

    There’s an adjective that won’t be used to describe JH: Beloved.

  29. Todd A. Peterson says:

    testaipira,

    Let it be known to all that franchising is nothing but a scam at all levels. Why does anyone need to pay royalties to some twit who thinks he reinvented the wheel on how to do taxes? Does having a name like Liberty Tax Service, Jackson Hewitt or HR Block make you any more profitable than doing good work on your own and having a relationship with your customers which promotes your business in the same way as it would if you were called Liberty Tax Service, Jackson Hewitt or HR Block?

    Open your own SMALL BUSINESS! Don’t pay someone else to give you courage!

  30. testaipira says:

    I wonder if anyone is buying Jackson Hewitt franchises these days. Fastest growing vs. Fastest Shrinking. Maybe Trisha should just buy one of those and move on with her life (and stained dress)

  31. ron says:

    How any person with an IQ higher than 70 would even think about using HR or Jackson Hewitt or Liberty Tax service is beyond my comprehension. To paraphrase WC Fields theres a tax prep sucker born every minute

  32. guest2 says:

    Means you don’t know what happens in a tax prep office. Where would you expect millions of people to get their returns prepared?

  33. Scammed1 says:

    Anything associated with Hewitt is a scam.

  34. Guest3 says:

    The average IQ in the country is got to be 70, so that is why these companies are so successful..I mean George W. Bush was elected twice.

    But back to this, Jackson Hewitt will completely close down once their contract with Wal-Mart expires. Liberty Tax is the fastest growing Tax firm ever. On pace to be largest by 2020.

  35. Michael Paul says:

    Any franchise reports on how BillFloat credit lines are going so far this tax season. I’ve heard a lot of problems with accessing the website and getting confirmation if credit line was approved.

  36. Greg says:

    Guest 3
    Are you serious? Liberty is going to overtake Jackson Hewitt first and then overtake block in 7 years?
    You might want to check that with a calculator
    In what….the last 10 or 12 years liberty has managed to get to 10% ish the size of block
    Then look at total acquisition of clients from last year
    Block gained more clients than liberty
    Not the percentages the actual numbers
    You can’t overtake someone if they are getting more real clients
    Yes libertys percentage grew but if you do 10 clients and add 1 it’s 10% growth (liberty)
    If you do 100 clients and add 2 it’s only a 2% growth (block)
    But the former outpaced the prior in bottom line client growth
    Now over lay that with this tax season to date
    Some internals are showing liberty down 60% and block down 35%
    That’s a lot of ground to make up
    If you want to stick with percentages to say liberty is fastest growing ever by the same measure this year you would have to say liberty is the fastest shrinking franchise in history

  37. Mike says:

    @Greg- you are asolutely right-percantages are nearly meaningless.. Liberty has not increased the paid returns in my area at all, as a matter of fact-paid returns in my area have decreased (just my observation from talking to the managers) more free returns maybe…? More free returns equals more wages, paper, toner, coupons, cookies etc. but how many cookies must you give your landlord to cover your rent?

  38. Guest3 says:

    Greg, Where are you getting down 60% and 35%?

  39. cynthia says:

    i believe that franchise is so cool , because you get to use someones stuff and actually pay them for it , jackson hewitt shouldnt go out of business , not untill the end of this tax season at least !!!! its raining , and it sounds so cool . but the door is open and im cold ,, usually taxes suck ,

  40. Steve says:

    With RAL’s all but gone, the low income crowd that Block, Hewitt, and Liberty have made their fortunes on are going to do it themselves. Most of those people have very simple returns and have paid crazy fees for getting their money a week sooner. That is gone and so is their market. Those low income taxpayers will seek out more reputable tax preparers when the CP2000′s come out for proof of everything they fraudulently claim on their self prepared 1040. That will be big business!

  41. Franchizee says:

    Steve you are correct. Hopefully enough of those self preparer’s will get the letters from the IRS. Also LTS schooling them and so did H & R Block, they took business away from themselves and made preparers getting paid from their group of friends.

  42. testaipira says:

    Did, $7k in net fees r today in my best office…..

  43. testaipira says:

    Where all the Jackson Hewitt Franchisees at? Are you guys still in business?

  44. Franchizee says:

    Bank product or cash in the bank today? How much in $50 CIF did you have to pay out today?

  45. Don't Be Fooled says:

    testaipira,

    Nobody believes you made $7000. Also, the reason there aren’t aren’t JH people on here is because this is UNhappy franchisee. It’s the Liberty people who are unhappy.

    Why do you keep coming to this page? Are you unhappy with Liberty?

  46. Mike says:

    Liberty pushed the idea they had loan products this past season. This was a scam to get new zees period. I was fooled into thinking jth bank was going to work. I spent a fortune to open a liberty and we had loans for about ten days. Most were not approved for the old ral type returns. With the crack down on eic loans were denied. When liberty was selling this idea for new zees it was a great thing and would make new returns and customers. They stopped the loans because some of them were not being taken out once the refund hit and customers were keeping the money.. . When that happened the zee was not paid fees but charged for a loan fee. I would not tell anyone to franchise with liberty and the crooks who lie about how wonderrful it is. Even if you did those 35 returns 19 percent comes off the top then you have at least 4 fms keeps so no payment then cif @50 bucks a pop then about 4 @50 bucks for. Referrals. Then average 2 hours for each return x labor cost. I’m not even adding in rent insurance and lights and those days are very few. I knew when I was on the top ten list of returns done for my area last year I was in big trouble and so were many other zees. My office was at a whopping 98 returns filed and out of those I was paid for 76. I lost 600 bucks in that group alone iin cif. When your a new zee in a new area cif is paid for every client since you have no way to know if they used liberty last year. Now I did lose a few customers because I wasn’t going to fake numbers to get a bigger refund. The tax business under liberty is a scam folks and your crazy to put out the money because the only one money is john hewit. I

  47. original mike says:

    Mike we all feel your pain. I hate to say it but welcome aboard.

  48. Up Hill Battle says:

    Thank you for the numbers Mike. The information is very valuable to someone who is considering the business. You cannot cover the expenses with those numbers.

  49. kim hyatt says:

    HELLO I AM FILING A COMPLAINT AGAINST THE FRANCHISE OWNERS OF RRD,INC.LOCATED IN KY.I AM SHOCKED AS TO HOW YOU CAN OWN A BUSINESS WITH THE EMPLOYEES THAT YOU HAVE WORKING FOR YOU AT THIS TIME.I HAVE TRIED FOR A MONTH TO SPK WITH YOUR MANAGER ROXANNE AT YOUR CHARLOTTE PIKE LOC.IN NASH.TN.TO NO AVAIL.I EVEN DROVE 75 MILES ROUND TRIP TO THE OFFICE TWICE IN ORDER TO HAVE HER HELP ME RESOLVE THE MANY PROBLEMS I HAVE HAD SINCE I FILED MY 2013 TAXES.I WAS TOLD BY THE OFFICE MANAGER THAT SHE WOULD TEXT HER AND LET HER KNOW THAT I WAS THERE.II WAS THEN INFORMED VIA TEXT FROM ROXANNE TO BRENDA THAT I NEEDED TO SPEAK ARLEIENE AT THAT POINT I WAS VERY UPSET BECAUSE I KNEW I HAD TRIED TO HAVE ARLIENE CALL ME FOR 3 WEEKS AND SHE NEVER CALLED ME BACK EVEN AFTER ADAM ONE OF THE CALL CENTER SUPERVISORS AT JH HAD EMAILED HER 8 TIMES REQUESTING THAT SHE CALL ME.I EVEN REQUESTED THAT I MAKE AN APPT.WITH ROXANNE THE NEXT WEEK SO SHE COULD ASSIST ME WITH MY TAXES THAT ONE OF HER EMPLOYEES AT THE ASHLAND CITY STORE HAD MADE A SERIOUS MISTAKE ON MY TAXES.(YOU CAN CONFIRM ALL OF MY PHONE CALLS WITH ADAM THE SUPERVISOR AT THE CALL CENTER.HE COULD NOT UNDERSTAND HOW I COULD HAVE BEEN TREATED SO BADLY AND NOT ONE PERSON IN AUTHORITY CARED ENOUGH TO CONTACT ME.)I NOT SURE HOW ANYONE CAN RUN ANY BUSINESS WITH SUCH POOR MANAGEMENT.THAT IS WHY I AM WRITING TO YOU I ARE YOU AWARE THAT YOUR COMPANY IS BEING RAN THIS WAY OR DO YOU NOT CARE ABOUT YOUR CUSTOMERS LIKE YOUR EMPLOYEES?I WANT YOU TO KNOW THAT I HAVE NEVER HAD SO MANY MISTAKES ON MY TAXES OR HAD AS MUCH TROUBLE AS I HAVE HAD WITH JH.I HAVE SUFFERED AT THE HANDS OF YOUR EMPLOYEES A FINANCIAL LOSS,A LOSS OF TIME AND A LOT OF STRESS.I WAS TOTALLY HUMILIATED IN FRONT OF WALMART CUSTOMERS AND THE CASHIERS AFTER I WAS LAUGHED AT AND MY NAME WAS YELLED OUT AND I WAS TOLD I DID NOT MAKE $100,000 BY THE TAX PREPARER TERESA.I HAVE SINCE SPOKE WITH THE PERSON IN AUTHORITY AT WALMART OF HOW MY NAME WAS SLANDERED AND HOW I WAS SO BADLY TREATED.AS WE ALL KNOW TO HAVE A CONTRACT WITH WALMART IS A PRIVELEGE AND SHE WAS NOT VERY HAPPY OF HOW I WAS TREATED BECAUSE I AM ALSO A WALMART CUSTOMER.THE WALMART MANAGER IS INVESTIGATING THIS COMPLAINT.I HAVE SO MANY ISSUES THAT I NEED TO SPEAK WITH SOMEONE AT JH ABOUT BUT YOU ONLY GET AN AUTOMATED ANSWER.IT SEEMS AS THOUGH YOU CAN NEVER SPEAK TO A HUMAN.I HAVE SO MUCH MORE TO MAKE YOU AWARE OF BUT I WILL WAIT AND IHOPEFULLY ONE OF THE OWNERS OF RRD,INC.WILL CONTACT ME ASAP.I HAVE ASKED FOR YOUR OFFICE NUMBER TO SPEAK WITH YOU AND I HAVE BEEN DENIED THE PHONE NUMBER BY EVERYONE I HAVE ASKED IN YOUR JH OFFICES AND THE PHONE CENTER.IM NOT SURE WHY A CUSTOMER CAN COME INTO ONE OF THE JH LOCATIONS AND FILE TAXES BUT THEY ARE NOT ALLOWED TO CALL THAT LOCATION AND SPEAK TO ANYONE. YOU HAVE TO CALL THE PHONE CENTER THEN THEY WILL EMAIL SOMEONE AT THAT LOCATION AND THEN YOU HAVE TO WAIT FOR A CALL BACK.I AM STILL WAITING ON A CALL BACK FROM MIRA H.SPRINGFIELD,TN (VERY RUDE THE ONE TIME I TALKED TO HER,THAT IS ANOTHER MAJOR COMPLAINT.I WILL GO INTO DETAIL WHEN YOU CONTACT ME BACK.)ARLIENE G.ROXANNE.I HAVE TRIED SINCE JAN.31,2014 TO GET A CALL BACK.I HOPE THAT YOU WILL CALL ME BACK OR EMAIL ME ASAP,THERE IS SO MUCH MORE THAT YOU SHOULD KNOW ABOUT HOW YOU COMPANY IS TREATING YOUR CUSTOMERS.I AM WAITING FOR A RETURN PHONE CALL FROM THE CEO AT JH I FEEL HE HAS THE RIGHT TO KNOW WHAT IS HAPPENING WITHIN THE JH FRANCHISE IF ANY OTHER FRANCHISE OWNER KNOWS HOW TO CONTACT THE FRANCHISE OWNER OF RRD,INC.IN KY PLEASE MAKE THEM AWARE OF THIS COMPLAINT I HAVE POSTED.THANK YOU,HAVE A GREAT DAY! KIM HYATT

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