Top

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

275 Responses to “JACKSON HEWITT Franchise Complaints”

  1. Up Hill Battle says:

    Sure Ray M, act before it is too late. It is the opportunity of a lifetime. It sounds like the same strategy that everyone has, sell as many franchises as possible.

  2. Guest says:

    Ray M. What a great franchise pitch! “Jackson Hewitt is fresh out of bankruptcy, has a new logo, and a fresh crop of gullible inexperienced franchisees! Get in quick, mortgage your house, buy’m up before the next bankruptcy!”

    Plus… they are “in talks” with Walgreens about installing 8,000 kiosks, which is exciting because everyone gets their taxes done at the drug store, and they’ll surely be in place by this tax season.

    Ray, I’ve been searching for the right opportunity, and “recent bankruptcy” and “in talks with respected retailer” “new management” and “flooding the market with franchises” are some of my top criteria. Where do I send a check, or should I just bring a suitcase of cash?

  3. Franchizee says:

    It sounds like it is too good to be true! We all know what that means!

    Another dog and pony show. They have not opened anything new in my market nor a market nearby my home. It is not true in my area, just the same locations.

  4. Ray M says:

    Wow, I lay my opinion and you year into me? It takes money and risk to make it. If your scared to lose this might not be your calling, New York Life is always hiring.

  5. Guest says:

    “Wow, I lay my opinion and you year into me?”

    Ray M. sorry for yearing into you but… your opinion is funny funny funny. “Hey, they may have bankrupted their business, but look at the snazzy new logo!”

    I laughed so hard by eyes were yearing up!

  6. Ray says:

    Liberty tax zees are scared,….I can smell it from here….nothing like paying 3% royalties for the first 3 years…what are you paying? lol

  7. Ray says:

    Liberty tax Franchise is the biggest scam….they are going downhill. Jackson Hewitt is still the #2 largest in the country…..and growing real fast…don’t be scurrrred.

  8. John Barilla says:

    haha… scared of Jackson Hewitt… Too funny….

    Over the last 5 years all of JH closed in my territories, I am sure I had a lot to do with taking all their customers. I am sure they are still doing good in SanFran, Franchizee and Bill’s territories because we had loser zees competing against you there.

    Bigger than HR Block by 2020!!!! , Ok back to counting my money, averaged 8 returns in each of my offices today….

  9. SanFranDan says:

    ^^^Give it up, Barf villa. You keep calling everyone “losers”. Too bad that’s your only vocabulary. YOU ARE THE LOSER the way you speak to others. You sir are a huge asshole. Keep it up, asshole. You keep calling everyone losers. Somehow in your sick, twisted mind, that’ll make you feel better. Only we know the real truth. Being away from that disgusting Liberty Tax Service was the absolute BEST thing I ever did. Someday you will find that to be true too. But you’ll never admit it. C ya loser.

  10. Ray says:

    5 days into the season and JH is up 300% in sales. I have already processed 45 returns on hold in 5 days @ an average $230 per return (my rent for the year is almost paid lol at $900 a month). It’s gonna be a great year!..I expect to finish conservatively at about 300+ for my first year! Jackson Hewitt all day baby!

  11. Erik says:

    I am also a new jh zee and the company has done a complete 180, it’s not the same company as 2010, how it plays out we will see, but for now at least they got there shit together and have an aggressive attitude encouraging and backing us to open next to Liberty locations (JH is offering corporate subsidies if your within a 1 mile radius of a Liberty) the plan could work or completely backfire.

  12. Mike says:

    Way to go JH, I hope you kick the crap out of Liberty!!! Keep us posted on your success!!

  13. Guest says:

    Really? You just can’t be serious.

  14. Aarom says:

    I am a new JH zee and I think the jury is still out on how the new concept is going to fare. I am just happy they rebounded from bankruptcy and are back in the mix, I agree with Erik they need to fire all the old guard and keeping moving forward with the fresh new concepts, they need to follow H&R Blocks mode with the clean organized stores. As far Liberty Tax goes there territory model is horrible and confusing and there marketing is zilch, no TV, no Radio, I mean Guerilla marketing can only go so far…I see H&R Block staying at the top with Jackson Hewitt a close #2 and Liberty Tax continue it’s mediocre existence.

  15. Sam says:

    It’s official Jackson Hewitt is back stronger than ever, we are the only ones offering $500 refund advance loans, next year there talking about $1000 RAL. H&R Block will stay #1 in my eyes but dirty grungy Liberty’s days are numbered. I always knew Liberty Tax was good if your into inner city consumers but they can’t touch JH. Thanks to our beast CEO Dave Prokupek, he is a genius among CEO’s so for the record I am drinking JH kool aid because my bank account doesn’t lie.

  16. John Barilla says:

    Sam,

    Yes you are the only one offering $500 refund advance loans since Liberty is doing $1000 to $3000. You are back after 6 years of losing market share and offices. Liberty has more store fronts. You guys have 2800 Walmart location with crazy rents that were increased and the reason HR block got out and Liberty is mostly out as it makes no sense. All the JH in my territories have closed down and I have picked up all their clients. Liberty is on its way to being bigger than HR Block by 2020.

  17. guest2 says:

    Ha! Ha! Ha!Ha! Too funny.

  18. Mike says:

    Guess barilla is one of the. scratch that he is the only one out of the thousands of franchisees that is here supporting liberty obviously Liberty sucks.

  19. Mike says:

    I love his comments because if it weren’t for him the site would be boring.

  20. Sam says:

    Liberty Tax is awful! Ghetto baby momma EITC schedule C fraud return driven business. I wouldn’t operate one for free. Btw Liberty is NOT offering RAL this year so stop the B.S.

  21. guest2 says:

    Wrong. Have loan program.

  22. Theo says:

    Ok, with the season almost done and as a new JH zee I can say without uncertainty it’s been a good 1st year, processed 300+ returns and it all had to do with not taking one day off, operating a clean new store and providing 100% customer service. That being said JH had as much too play with my success as the new ceiling tile. I think I would have done great if I was any of the big 3, I believe it’s all in what you put into it. I think people here miss the point, no single franchise is perfect, so many variables go into a successful business. I have seen all 3 do good and bad depending on location, owner and experience. All in all I just hope this JH resurgence is not a fad and we continue growth because I see s bright future at my location at least. Wishing you all sucess (even Liberty Tax lol)

  23. Theo says:

    Last thought….biggest mistake Liberty made was not advertise heavily after JH was on the ropes in 2010 or even offer to buy them out, they really had a chance to move in for the kill with a KO blow but instead allowed JH to to regroup and reorganize…I guess Mr. Hewitt is not as smart as people think…a chance of a lifetime blown, and now we’re back on national TV growing again like it never happened. God bless the american consumer and there short limited memory..that and a big private equity firm backing you up. lol.

  24. Brian says:

    Has anyone looked into the new franchise, Happy Tax? Interesting business model. All they need to add is tax resolution services and I think they have a one-two punch combination. Any thoughts?

  25. Guest says:

    Two words for you. Identity thief. Clients who use CPA’s won’t meet in coffee shops with strangers who say they are cpa’s. How would the franchisees cover themselves? Drop off and pick up needs to be connected to an office. Won’t work.

SHARE A COMMENT HERE:





Bottom