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LIBERTY TAX SERVICE Franchise Complaints

August 11, 2009

UnhappyFranchisee.com asked: Are LIBERTY TAX SERVICE Franchise Owners Happy? If you’re familiarliberty_logo with the Liberty Tax franchise, please share a comment below.

Entrepreneur magazine has ranked the Liberty Tax Service franchise #3 behind  McDonald’s & Subway.  However, some commenters who claimed to be former Liberty Tax franchisees left stern warnings on the Franchise-chat forum.

BostonTax wrote:

I’m a former Liberty Tax Franchisee

I hope you are ready for a little enlightenment! I held a successful Liberty Tax Franchise for 5 years until I decided to let the franchise agreement lapse. I did this for a few reasons:
1. The royalty fees were outrageous! 14% went to normal royalty while and ADDITIONAL 5% went for so called advertising royalties. The ad royalties were supposed to be put back into your local market to build the brand name. This was never done! All advertising in addition to the ad royalty I had to pay for because it did not fit into Liberty’s concept of advertising. I don’t know exactly what the concept was because our AD could not give an answer and the approved methods changed by the week.
2. Corporate was totally unresponsive to the needs of the franchisees. The AD system is designed to recruit anyone who can write a check for 100K. No other skills or ability required.
3. The minute you are behind in a royalty payment, they send you a notice to cure. After that, if you don’tpay, they try to terminate your franchise agreement.
4. Upon termination, Liberty enforces through legal proceeding a 2 year, 25 mile radis non compete clause that is in the franchise agreement. This is enforceable in the Eastern Division of the Federal District court, where, at least 2 Liberty friendly judges preside.
5. Liberty does not recognize chargebacks for bad debts as an adjustment for your royalty fees. All royalties are based on your gross, not your net collectable. This was an ongoing issue with them and the accounting department did not have the ability or the inclination to resolve!
My best advice is do not go with these guys, they are bad news. If you like to have people collect royalties and provide no support, then this is the franchise for you! It is very expensive to get into, the initial fee is around $32K just to buy the territory plus those pesky royalties. You can’t make money on this concept.

Most of the surviving franchisees I’ve talked to in the last 2 years have experienced great difficulty not only in making a profit, but in the corporate support or lack thereof.Remember, 19% of your gross is getting kicked back to Liberty, which is excessive by any standards. Please do yourself a favor and call former franchisees ,those that are currently getting sued (they are very likely to talk, as I found out), and current ones to try to get the straight poop.

Barbara Green wrote:

I too was a Liberty Tax Franchisee and I agree with everything you said.

The only reason for purchasing any franchise is because the business model is a proven marketing success as evidenced by the profitable franchisees. That is why you pay a license fee of $25,000. Being profitable is not in the cards for a Liberty Tax franchisee. Liberty Tax’s market/ business model is aimed at individuals who have very simple tax returns, i.e one W-2 and standard deduction which is why they were very successful in Norfolk, Va. That market is full of military people with one w-2.

Liberty will sell anyone a franchise at any location, in any georgraphic area, even if there is not a chance in hell of the franchisee being successful.

At one time, I too owned a Liberty Tax Franchise for one tax season. It was only one season because of the behavior of the Regional Manager who called me on January 15th demanding and screaming “Why had I not generated 200 tax returns and that maybe this business was not for me. I was stunned and confused since employers are given until January 31st. to give w-2′s to employees. Apparently, he thought that I was in Norfolk, Va. where that is possible.

It only goes downhill from there. The bottom line is I lost all of my investment in this businees (approx. $80,000) because I closed it rather than becoming a victim of this unethical company. NOthing would make me happier than to be a part of a class action lawsuit.

WHAT DO YOU THINK?  DO YOU OR HAVE YOU OWNED A LIBERTY TAX SERVICE FRANCHISE?  ARE LIBERTY TAX SERVICE FRANCHISEES HAPPY?  WHY OR WHY NOT?

Comments

3,818 Responses to “LIBERTY TAX SERVICE Franchise Complaints”

  1. Another Zee says:

    I am also a Liberty Zee (south jersey/philly area) for over 3 years and this ranks up there as one of the worst decisions I ever made. I could list the tons of lies and horrible advice I was given over the years from the salesperson and my AD, but I’ll keep it short. I followed the Liberty model in year 1 and lets just say I am still trying to pay back debt for all the cash I put out in my first year, which of course is taken by Liberty.

    My advice, like others have said, cut back your marketing, preparers and any other expense you can think of. I am down to the bare minimum, if I cut anything else I will be doing taxes on the street corner. I hope to just get out of this mess unscathed. I am a CPA and this is not the kind of work I want to be involved in, I want to do taxes, not overcharge poor people for 20 minutes worth of my time.

  2. Free at last says:

    Another Zee:

    Has Liberty sued you yet? Have theycalled your clients to get them back? They have pulled that stuff on me and much worse!

    A word of warning: it is extremely expensive (legally) and difficult to get out from under these people.

    Also be aware that LTS will ask you to do disreputable things such as jacking the costs of preparation and EIC returns. Don’t risk you license for them or an AD that has no clue as to what the business is all about.

    They are still charging $400 + a return in my area to people who can ill afford it.

  3. Another Zee says:

    Well, I am still part of the ‘machine’ right now. I am not looking to take any “Liberty” customers, I live about 30 miles away. My original customers and the referrals I got from them will follow me, but I’ll play by the rules and not solicit. And the only reason why I’ve kept most of my new Liberty customers is by reducing the price to a reasonable amount, if the next owner or Corporate holds firm on their high rates, I would imagine they will lose some business.

  4. bill says:

    Zee in Philadelphia/SJ area:

    I was in SJ for 4 years with Liberty franchise and I never got over 250 returns. Of course it was my fault because I didn’t follow the system. I can remember a meeting with myself and several other franchisees. They sent “Ruth” Vanderpool and Nannette to meet with us because that year the State software for NJ wasn’t right and everyone was getting the $50.00 property tax credit. Never in 4 years did they offer any constructive comments.

    I take is as my personal responsibility to warn anyone I can to avoid this franchise. A few years back I had an inverview with a large CPA firm in Cherry Hill who was considering franchises through Liberty. By the time I left the interview the partner nixed that Idea.

    Another zee:
    A possible work around is if your spouse did not sign the Liberty agreement there is nothing to prevent her from opening up a tax service and you working for her. She certainly could solict your old clients and you would not be in breach of the contract.

  5. wanda schwaab says:

    Im writing for my self. We definitely will not be using Liberty Tax again or will we recommend anyone else to use them either. I filed my taxes last year with Liberty and had no issues but this year ruined us as customers ever again. 1. i filed my taxes in the middle of January got my federal refund back but when i got the call i went in to pick up the check i had to wait almost 3 hours cause 1 of their employees put the wrong paper in to print my check. 2. Then about 1 week later when i was waitin for my state i called the state and they told me that it had never been submitted so i had to call Liberty Tax and they has to resubmitted again. but the point is that its just one thing after another cause now my boyfriend had the samething done to him except it was his federal not his state. So I would like to kno how LibertyTax is goin to make things better because now Liberty Tax has a bad name to us and all the people you guys have as clients that are affiliated with us. So if you could make this right it would be appreciate cause I paid you alls fees and got screwed cause of your employees I filed my taxes at the 644 North Saddle Creek Store 402-558-3379 I AM REALLY DISAPPOINTED IN LIBERTY Tax

  6. BILL says:

    The only advertising Liberty offers is wavers and facebook, is this a company that you want to invest in. Dosen’t believe television advertising works! How does that thought process create a “national brand”. Hewitt loves to compare this business to fast food, you can’t name one successful fast food franchise that doesn’t advertise.

    Buyer Beware!!!

  7. mike says:

    Wanda,

    You need to call 800-790-3863, ask for John Hewitt he is in charge of their Customer Service. They have a Satisfaction Guarantee, he will be the one to honor it , If you post this message on Liberty’s fb, so everyone disatisfied knows whom to call, you will probably get this resolved faster, good luck keep us posted! More importantly tell every dissatisfied customer you know to do the same.

  8. Another Zee says:

    Bill:

    I am not married, but my understanding is that i can not solicit any Liberty clients, but I also can not stop them from seeking me out. I have my pool of grandfathered clients and the referrals they have given me, and none of them go to Liberty because of Liberty, they only go to Liberty because of me. I’m actually 20 miles from my territory, if only I moved 5 more miles away then it would be fair game. haha

    By the way, do you know how they pursue this? I would think that who a taxpayer chooses to prepare their taxes is a privacy issue and none of Liberty’s business.

  9. bill says:

    Another Zee:

    I don’t have the terms of the contract in front of me but I do recall that I couldn’t open a store with in 25 miles and solicite the clients for a 2 year period. In my case I went to work for a local CPA and anyone that was my client at Liberty I told them why I was closing and where I was going to be working. A decent numer of those individuals called the firm and followed me over.

    Another former franchisee basically told the customers he was leaving Liberty and again the clients contacted him to do their taxes. It was a second business for him so he just did the work out of his house. Again he didn’t actively pursue the client. The client made a decision to follow him. His comment to me was I make more money now doing a 100 returns then I did doing 500 returns with Liberty. Liberty did send him a letter and of course they did try to retain as many client’s as they could by offering discounts but that was about it.

    Remember the contract is between you and Liberty. It can’t prevent someone else from starting their own tax practice and hiring you. The relationship between the preparer and the client is most important factor and if they like you they will find you.

  10. Another Zee says:

    Thanks bill. That is my understanding of how it works. My store is actually profitable at this point, but its just not worth all the extra work and energy I put in, like you said, I can do 100 returns from home and make more than doing 500 here!

  11. Texas Zee says:

    I would have to disagree on making more money at home with 100 returns vs 500 at a tax office. Let’s say there’s no difference in ANF in either scenario and you do $200. That would be $20,000 of revenue vs $100,000 revenue. Let’s assume you have only $5,000 of expenses at home your profit is $15,000. At a Liberty tax office you can do 500 returns with expenses of about $70,000. I know this for a fact. Your profit would be $30,000. I would agree that it would be less stressful at home. However, working out of your home would probably limit your growth potential. Also the thing to remember is in the tax business most of your expenses are fixed. Every new return should be at a 75% margin. So if you grow your business to 700 returns in a few years your profit would double to $60,000. If you can get to 1000 returns in 10 years your profit would be a little over a $100k. Each person can decide for themselves if that’s worth the work involved. Also I think some people are not able to get to that number of returns or have the ability to keep their expenses in line. If you can’t grow your return count or control your expenses I’m sure it can get very stressful as your money drains away. I think some very valid observations have been made on this board but personally being a Liberty Zee has been a great experience for me.

  12. Another Zee says:

    Texas Zee, The NJ area seems to be a more difficult sell, at least from what I hear from others. I also work a full time job and make decent money, this is just a little extra and for all the time, effort and energy I have to put into it, I can do without the couple extra bucks.

  13. Texas Zee says:

    I don’t have to work because my husband makes decent money. He actually encouraged me to start the business so he could retire early and come work for me. I started the business without borrowing a cent and my financial goal was to get to a $100k profit within 10-15 years. I’ve been at it for four years and should get there in 8-10 years so I’m pleased. I certainly have no interest in multiple locations. I just want to build a loyal customer following and have really focused on professionalism and great customer service. I opened in a higher income area because I was concerned about the long term viability of the bank product business. This franchise will allow us to have a very enjoyable life style when we get older. I know most people are not in my situation and are counting on the business to be their primary source of income too soon. I think that’s a big mistake and will lead to tragedy. Your time horizon should be at least 5-8 years to make decent money when opening a location. My two cents for what’s it worth.

  14. Bill says:

    Texas Zee:

    What did Liberty provide you that you couldn’t have done on your own especially in the higher income neighborhood? It’s been my experience in the NJ area that there is no real brand recognition and I didn’t/or was hoping that it would change with time. But the only people aware of Liberty are the people who use their services or the retail franchises and ones like HR Block don’t view them as a threat. Most tax professionals don’t even recognise the Liberty name until you mention something about wavers and then you get a response like “that’s what that is”.

    How do you compete with the major players in the tax industry when you don’t have some sort of national advertising. As I pointed out in my earlier post, John was focused on selling franchises and advertising was just to expensive for his plan. His goal now is to cash out but I just don’t see the IPO being a success.

    Buyer Beware!!!

  15. Frustrated and Disgusted says:

    Texas Zee;

    You are right, most people are not in your situation. Waiting 5-8 years to make decent money is not an option, nor does it make good business sense. Had you invested $40k and had to borrow, you would be waiting a lot longer. I would be willing to bet that you could have easily done what you are doing without Liberty. Had you done it on your own, the time horizon would have been a lot shorter, and you would not be a puppet to a scam artist.

  16. Texas Zee says:

    Frustrated and Disgusted:

    I have a feeling it’s going to start getting ugly in here so I will sign off with this. I invested $81,418.13 to start this business and a lot of sweat equity. In return I will get a revenue stream over the next 25 years that is over $2M and afford me a comfortable retirement. I will be able to travel and share time with family during the 8 month off season every year. It was worth it to me to invest the up front lean years to get there. It may not be for everyone. As far as doing it without Liberty I don’t think I would be as successful. I ignore some of what they preach because I’m a thinking person that knows my unique situation. I truly believe that they do provide a level of support that I couldn’t do without. I do realize that I’ve never been in a debtor situation with them which would probably negatively impact my relationship with them. I’m sorry it did not work out for you and it has obviously left you very bitter. I wish you nothing but success in your future endeavours.

  17. Frustrated and Disgusted says:

    Texas Zee;

    I am not going to get ugly about you or your business. As a matter of fact, if you providing good service at a fair price, and are conscientious about doing a good job, I commend you. That is what American capitalism is all about. What I don’t like is seeing people get ripped off. Look through my posts and what I have tried to do is present facts about this business. Most people who start and get into business are doing it to earn an income, and it needs to happen within a couple of years. If a business is not earning a decent profit by year 2 or 3, it should be. That is just basic business 101. Your situation is very different, and while it works for you, it won’t for most unless it is a sideline business. Again, if you had to finance and you were not active in the business, it would be a loser for sure. When I went to Virginia Beach, I was told about how many people were able to quit their day jobs after a couple of years to concentrate on running Liberty. That’s a bunch of crap, you know it and I know it. You bring up some good points, so stay active on this site to keep the other posters honest.

  18. bill says:

    Texas Zee:

    The more I think about your comments the more I think you are an area developer.

    Where in Texas are you located?

    How did you calculate a revenue stream of $2m over the next 25 years?

    Without

  19. Richie B says:

    Bill,
    99% of the people who claim to be Zee’s on this site and post positive remarks are JH plants. Before investing in Liberty I had run 3 companies for over 30 years and my own company for 10 years with no problems and they were all profitable, but I had a good business plan for all. Liberty has no business plan that works and no advertising what so ever. No wonder they have no name recognition in the tax field. I advise everyone to stay away from this franchise. I lost a lot of my retirement trying to make this franchise work with no help from Liberty or any of the 3 Area Developers I had. I soon found out that area developeers are only out there to sell frranchises for John Screwitt and not to help the franchisees

  20. Frustrated and Disgusted says:

    Richie B.

    I think you will find many who agree with your comments. This is about as close to a business in box as you can get. I too lost well in excess of $100K in a three year period, and had nothing to show for it at the end but a mountain of bills. I have visited a ton of franchisees at this point, and with the exception of those who are in very low income areas, the rest are marginal at best, most are losing money. Please stay away from this sink hole.

  21. Bill says:

    Was wondering what Liberty was doing to counter act all the “free return ads”?

    I can’t imagine this is a good year for a first year tax prep franchise. PTIN requirements, fees, etc.

  22. Chris says:

    As a customer point of view I found Liberty Tax to be a scam. I came in and was never told upfront what my tax preparation costs would be. Later I find out that the dollar amount I was given at first was not my real tax return but the return I would get after fees were deducted. I find that not being honest. Also tax preparers aren’t that highly trained. Liberty Tax is a scam.

  23. Frustrated and Disgusted says:

    Bill;

    I have seen/heard ads on the internet, radio, TV and mailings for just about any retail or software tax product on the market except for Liberty. Tells you how out of touch this organization is. They are still thinking the yellow pages are the way to go. I recently went to YP.com and typed in Liberty Tax for my area. The listings came up and on the right hand of the page where the ads were, Jackon Hewitt and H&R Block had ads for their local stores. I have yet to see any ads whether inserts, or otherwise for Liberty. Are they still in business ?

  24. Don't Be Fooled says:

    Liberty intentionally doesn’t tell you the price of the forms. They like to say the price depends ‘on the complexity’ and forms involved in the preparation. Why doesn’t Liberty disclose up front, through signage what each form costs? They never would, because their pricing is a rip-off. Look at their Facebook page and see how many people are being gouged by them, it’s ridiculous.

    They want the customers to only look at the amount of their refund….so what if the 1 w-2 and EIC is all that is on the return. They intentionally gouge the EIC customers because, in their eyes, it ‘is free money’ to them.

    My advice, stay away from Liberty, and if you are involved with them, get out ASAP and go on your own, you’ll be better off.

  25. Rob says:

    Your explanation about pricing is just not based on any facts and is not even close to being reality. Lets look at a early season client and a late season client. Late season client has a fairly complicated return comes into office and in 30 to 40 minutes we complete his return and he writes a check for $280. Once client leaves unless there is a question or he needs service we will see him the next year.

    Early season client walks in. Early season client has no money to pay up front which is fine. Early season client wants fees taken out of check and chooses not to do a RAL. Tax preperation is fairly straight forward W2 for 3k and schedule C for babysitting where she made 4k and claiming 2 kids but would like to know what 3 kids woud do to her return. Most of time is spent explaining EIC and warning client of the danger of EIC Audit and if he or she does get audit to make sure they let us help. Client signs bank applicaiton and rest of paperwork Invoice price is $420 she elects to take $50 Cash which is a discount paid in cash so fee is $370 plus bank fees. When this client leaves we are far from over. Her check should be here in 8 to 15 days and as the Z I need to staff so anytime one of the early season clients call that they get the service they desire. This means getting yelled at because the client has past due bills, getting 2 calls a day to ensure we have not printed her check and forgot to call. With this client only 25 percent to 30 percent of the total work is done and the man hours to service a large number of these clients is high. But to be able to retain this client and to ensure this client is satisfied all of these items and even more must be done otherwise the client will find someplace that will do these items.

    Early season client was charged $100 more in this example. Many times the difference is not near this much. Just looking at forms is not even close to reality and the work that is done. Saying that Liberty gouges is just not the facts. I set my own prices and I know what it costs me to give clients what they want. Sure I can lower and give less service but I would loose clients. Anyone that doubts what I have said I invite you to find a tax office near you and spend one day in that office toward the end of January, then revisit in late season and see how reality is!

    Sure there are preparers that gouge. But many more are not and because of want clients demand in there preparer prices are high. Pricing is not that far out of line for the work being done.

  26. Rob says:

    Also the idea we gouge EIC clients because we see it as free money is garbage. Accusations like this sound real good on the news or on a site like this that only wants to get out the “Sensational Facts” that make there arguments appear to be solid. But facts are totaly different. I have invited many just like this to come in my office and see what the real story is but very few want to take me up on it because very quickly they realize that I am correct.

  27. Rob says:

    Also we have not gotten into the facts about getting paid. Preparers have no clue how many of these returns will actualy be funded and will get stuck doing a certain percentage for free. This also has to be figured in when calculating price. Tax Preparer only gets paid after IRS takes any money owed, Bank takes money owed.

  28. Don't Be Fooled says:

    Your last post is telling…you get stuck with non-paying clients, so you gouge where/where you can. Have you looked at Liberty’s Facebook page? Every post talks about how high your prices are for simple returns.

    You may be a good, honest franchisee, but many/most are gouging when it is possible. That is a fact.

  29. Don't Be Fooled says:

    Also, will you please post the price of YOUR forms?

    Does Liberty tell you what to price them?

    Why so much angst from Liberty customers regarding price?

    Does your invoice break down the price, form by form?

    Are the prices clearly posted in your/Liberty’s offices…..why not?

  30. Another Zee says:

    Don’t Be Fooled:

    We do not disclose the price of our forms, just like HR Block and Jackson Hewitt does not disclose the price of their forms. When I call HR Block they tell me the rate for a 1040 starts at $149, they do not provide anything more than that. Liberty franchisee’s set their own pricing and in my office, I’ve had ONE customer in 3 years that we quoted a higher fee than HR Block and Jackson Hewitt, all others have been significantly lower.

    And no, we do not gauge on EIC customers. Rob explained it very well, we have to charge more because those customers require a LOT of customer service and resources. We also have to compensate for the risk of not getting paid at all. How many other businesses do you know of that will give a customer a free product because of something that the CUSTOMER owes? Last time I checked, when I pay my dinner bill, the waiter does not say, “oh, I see you have credit card debt, your meal is free tonight”

  31. rob says:

    Liberty does not tell me what to charge. They never have told me what to charge and never will. I set my pricing according to what my numbers are showing me each year. Last 2 years I have lowered my pricing. Why? Not because I was told and not because I had to. I did it because as a business owner my business has been able to produce a product at a lower cost. Since I was able to produce the product at a lower cost I passed the savings along to my clients. This is something that happens in business all the time. If I did not pass that savings along to my clients they would leave and I would not have the very high retention rate that I do.

    Now if I would take what others are saying here and use that logic. I would not offer the service my clients want because it would cause prices to be too high. Clients would then be upset at the level of service they deisired yet did not get and they would leave and my retention rate would drop.

    All of this is very simple. I cannot speak to others on how they do there pricing. I can tell you that I would not have a 60 percent plus retention rate in the early season with clients who felt I charged way too much.

  32. rob says:

    If my early season clientelle for some reason would change overnight. And like my late season would not require the extra work and cost after filing the return, then there prices would drop. When comparing different types of clients you have to know and understand what work is involved and the associated costs. Just because someone has EIC is not open season to charge whatever you want and never will be. Likewise if my late season would require me to do the work after completing the return there pricing would go up the same. There is no conspiracy here. I am in business to make a profit. If I charge and the charge does not equal the level of service I provide clients will not come back. But since I am able to retain 60 percent plus apparently I am doing something correct. And the 60 percent I speak of is just early season it will rise in the late season even higher.

  33. Another Zee says:

    I think a lot of people are misunderstood when it comes to Liberty. Each office is owned and operating by difference people, some are accountants, some are not. You may have had a bad experience at one Liberty, but that is not a reflection of how every office is run. I give tons of discounts to customers and cut breaks all over the place to make sure my customers are getting their money’s worth. Some appreciate this and some just want more and will complain no matter what I do. It is what is it. The ones who appreciate are part of my 60%+ retention rate and those that do not, will become someone else’s problem next tax season!

  34. Another Zee says:

    *It is what it is.

  35. GuestA says:

    I know that when I was a franchisee, Liberty, through their incompetent AD, told me point blankly to lift my fees so that I could take advantage of the early season filers. I really had a problem with this and said so. I was told to shut up an do it. Does anyone else have this experience? I was really upset with Liberty as were my employees and am thankful that I am no longer associated with such a dishonest organization.

  36. honestly says:

    For one I am not doubting you the AD told you to raise your prices. But you were the business owner, you were not a employee. Your AD is there to support you not be your boss. Let me ask you a question though. What fees did you want to charge or what was your fee when he wanted you to increase them.

  37. Bill says:

    GuestA

    Rob and Another Zee both receive corp’s price list it’s built into the software. This is the price that new franchisees are required or pressured to use. The business model is based on the early filer and the only way to have a net average fee of $200 is to have high fees. As Rob pointed out he charges $420.00 (Which has the built in cost of the $50.00 cash in a flash that he says is the discount) for a straight foward return but explains that he has to do a lot of explaining to the customer about the third child and the risk he is taken. Considering that one of the ways of increasing the EIC is through the sch. C for babysitting.

    Rob has been a liberty franchisee for a long time. He knows how to work the lower end tax filer. He also is good at the spin. But my guess for why he lowered his price has more to do with competition and education of the lower income filers. The Liberty business model is dead but for the establish franchisees like Rob who built up a client base they will be able to survive. For new franchisees trying to rely on this business model it is just not going to work. Look at all the advertising for free filing how is a new franchisee going to compete. HR Block now has an app for you to take a picture of your W-2 and they can complete your 1040-ez for you. This type of Technology is pushing prices lower. Liberty is not cabable of keeping up.

  38. Another Zee says:

    Yes, Liberty provides a schedule, but I have never used their pricing, I always adjust and my AD does not say much about it, but by the time Liberty gets their cut, employees are paid and rent is paid, I end up making a few cents an hour, definitely not worth my time.

  39. GuestA says:

    The AD demanded a raise in prices from an average of $225 to at least $325. I asked why and he said that the Corporate office wanted it done.

  40. Frustrated and Disgusted says:

    I think we should all feel really bad for Another Zee. He may lose $5 or $6 of labor if he is not paid for his return. So he charges $300-400 to make up for it. C’mon, how stupid do you think the people on this site are. WE have all been there and the number of returns that end up not being paid is extremely small. You are a typical JTH kool-aid drinker.

  41. Another Zee says:

    Frustrated and Disgusted, first of all, NONE of my fees are that high, I have the lowest ANF in my developers entire area. I am a REAL accountant and believe me, my customers get their money’s worth.

    Not my fault you lost over $100k in your little venture, sounds like you are the one looking for sympathy. I might not be making money, but I am definitely not dumb enough to keep dumping endless funds into LTS.

  42. Richie B says:

    Another Zee,

    Most of us on this site were not dumb enough to keep pumping money into a loosing business. Anyone getting into this franchise should have a backup business
    because it will take a good 5-6 years , if ever, to build it to anything. We are enraged because we have received not one bit of help from a franchiser after turning over our hard earned money. All we received was BS about gorilla marketing and AD’s who didn’t have a clue how to build business. Basically we received nothing for our franchise fee. Liberty devalued the franchisee when they went to “try before you buy”. Nobody including myself was able to sell their franchise because of this. Yes we are bitter. I had to give it all back after two years and take a loss because as you have stated I am not dumb enough to keep pouring money into a loosing business. Good luck with your accounting side of the business. Hope it’s enough to keep you afloat. In case you are wondering about my prior business experience I have suscessfully run 4 businesses and sold them
    for a profit but each had a good business plan.

  43. Another Zee says:

    Richie B, my comments were in response to Frustrated and Disgusted; I know this is a losing venture for all of us, but didnt appreciate his/her comments towards me implying that I rip my clients off and am drinking the Liberty kool-aid, couldnt be further from the truth.

  44. Richie B says:

    Another Zee,
    Unfortunately I understand where both of you are coming from.
    Good luck to you this year I hope it works out for you. I don’t like to post on this site alot just because it gets personal at times. Frustrated just keep it negative toward Liberty and not other zee’s who are out there struggling to keep afloat. They are having a hard enough time, you should know. These are hard working people who have a lot of money invested. Keep it cool man.

  45. johnbarilla says:

    Sounds like F&D wants to have it both ways… First he argues this is a bad business but then he argues that you can charge $400 for simple returns that cost you $5 of labor….. Obviously, he has no clue, he just is going out business because of himself but want to be angry at the world…. By the way, he and Bill and Mike are all the same person, using different Aliases…

  46. dr zhivago says:

    An AD gets a cut of the royalties from a new zee, so it’s in his interest to tell you to increase prices if they think it can add to his bottom line.

  47. Frustrated and Disgusted says:

    dr. zhivago;

    The A/D get 50% of the royalties. And most just sit and watch the checks roll in.

  48. bill says:

    John:

    If only it was just one person. Unfortunately for Liberty Tax they can’t control the internet. Forums like this one provides an oppurtunity for people like myself to provide information to potential franchisees that they won’t get from JTH. As you know from your franchise agreement you are prohibited from talking negative about Liberty and it would be risky for any franchisee to be honest about their experience to a potential franchisee because they could be a plant.

    As I stated before I’m here to present facts and share my experience with potential franchisees.

    #1 fact Liberty Tax Service the corporation does not do any TV/Radio advertising nationally or regionally.

    #2 fact Liberty Tax Service is a distint third in the retail tax prep. industry doing about 1.1 million returns compared to 19 million for HR Block and 2.2 million for Jackson Hewitt.

    #3 fact Liberty Tax Service bought E-Smart in 2007 for 6 million dollars for it’s online tax presents and then had to write it off two years later.

    #4 fact Liberty Tax Service when from selling new franchises for a $40,000 franchisee fee to now selling new franchises for $2,500 deposit with higher royalties.

    #5 fact Liberty Tax Service is trying to have an intial stock offering but as of this date has been unable to move forward due to market forces.

    Buyer beware!!!

  49. Honestly says:

    Sorry but fact number 1 is partially incorrect depending on how you look at it. Liberty does do regional radio advertising in areas where the dma has enough advertising dollars to support it. Had them in my region and I know many areas that same thing has happened. No if you are in a smaller or underdeveloped dma you may not get radio but radio does happen and has for several years. Not going to sit here and argue like u want just wanted to clarify that point

  50. Frustrated and Disgusted says:

    I ran into a good friend of mine the other day who owns the business down the street. He runs a deli business, quiet moderate income neighborhood, mostly apartments. Open between 8-4 each day. Does quite a bit of pick-up box lunch catering, otherwise, normal sandwiches etc. Gross past couple of years, between $225-250K. Net $70-80K. Picks up his kid at school, enjoys his evenings, has a good life. Liberty Tax, gross $100-125K if the star and moon are aligned, make a profit if you are lucky. Take your pick.

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