Are LIBERTY TAX SERVICE Franchise Owners Happy?

Are you familiar with the Liberty Tax Service franchise opportunity? 

Are Liberty Tax Service franchise owners happy?  Why or why not?  

Please share your thoughts and opinions below.

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In 2009, Entrepreneur magazine listed Liberty Tax Service as the #3 franchise, surpassed only by Subway at #1 and McDonald’s at #2. 

It was quite a leap, since Liberty Tax Service had never made the top 10 (Subway had been named #1 16 times, McDonald’s 8 times). 

Previously, Liberty Tax Service franchise had ranked #23 (2008); #17 (2007); #10 (2006); and #15 (2005).  We don’t see any explanation by Entrepreneur for the sudden ranking surge.

Could it be Liberty Tax Service’s cutting edge branding & marketing programs that vaulted them to the top?  (See picture, left)

Entrepreneur’s listing is fairly generic, “In 1997, after selling Jackson Hewitt Inc.–the tax-preparation service company he founded 15 years earlier–John Hewitt acquired a Canadian tax franchisor and established Liberty Tax Service. A year later, Hewitt expanded into the U.S. with five offices; at the close of 2008, the number of U.S.-based Liberty Tax Service franchises had grown to nearly 2,500.”

Is Liberty Tax Service such a great investment opportunity that it deserves to be listed as #3 in the nation?  Does it provide superior training, guidance and support to its franchise owners?


Photo credit:   January 25, 2009 by Brent and MariLynn Taken in Smyrna, TN  License:  Creative Commons 

110 thoughts on “Are LIBERTY TAX SERVICE Franchise Owners Happy?

  • January 25, 2010 at 4:43 pm

    Serena! I think, upon investigation, you would find that the creditors of unsophisticated small-business franchisees, primarily the franchisor, when loaning to the franchisee, and the Landlord, especially, demand a “personal guarantee” no matter how the franchisee is organized to do business.

    It may be that the wealthy and multi-unit Multi-unit-franchisees do have protection when they organize under LP or LLP’s (it would explain the restaurant sector) but the unsophisticated Mom and Pop franchisees can’t get loans and/or credit without the personal guarantees.

    The unsophisticated Mom and Pop franchisees sign these personal guarantees believing, of course, that the risk is small —and, of course, the true risk of the investment is obscured from view because of ineffective and defective regulatory policy. They are shocked and sick at heart when they lose their homes and everything they have worked for.

    Of course, the rampant fraud in franchising today has been encouraged by the banks who would loan on the equity in the personal residence to finance startup costs for franchisees with no diligence on the business for which the home equity loan was granted. No doubt, this scenario is playing out right now in the commercial sector and the banks and lenders are getting burned.

  • January 25, 2010 at 4:47 pm


    If you take a look at the court cases that Liberty vigorously litigates, you will find that the judges that they have obvious influence with, tend to disregard whether or not you are a corporation. There is simply no protection for the franchisee.

    I owned one of these franchises for several years and there is just no way from getting out from under these thieves! There is no protection of your personal assets when you are involved with Liberty. They derive most of their income from the churning sales of new and existing territories. They prey on minorities by offering “internal” financing that consists of a 3 year note on the purchase of the territory at 12% interest. By the way, Liberty gets paid on their note and royalties first, before you even see your first dollar. This they do by making you sign a fee intercept agreement. You are working for them as a slave for the duration of your contract and for 2 years after.

    When I signed on, it was early in the E file craze and Liberty sold a bill of goods that they had the best system of marketing and for the filing of tax returns. They also said that you could charge pretty much anything to people who wanted to get a refund loan. Guess who that target market is? Military and minorities. Ethics has not bothered Liberty Tax at all.

    Anyone who is considering buying this system of enrichment of John Hewitt, should contact every one of the Ex franchisees listed in the offering circular and find out why they left and for how much they were sued for. Liberty has continually mis represented the earnings, the potential and their expertise.

    Don’t let this happen to you as it has happened to me.

  • January 27, 2010 at 7:48 pm

    Wow, this blows my mind. It is great to know this ahead of time though. I really appreciate your comments. I did think that buying a franchise, especially from a well-known franchisor like Liberty Tax, would be far less risky than starting on my own. This is a single reason why I am looking into buying a franchise. I thought it is like buying a “fail” proof business system since they already have strong customer base. But, it does make more sense now – Liberty Tax, of course, wants to make money FIRST!!!

    This made me think though, 9 out of 10start-ups fail within the first few years of operation. It seems like there is a very slim chance of making it on my own. Of course, Liberty Tax knows this, and takes advantage over people like us who don’t want to fail and who believe that buying a franchise would decrease their rate of failure. If franchisors like Liberty Tax can get away with misrepresenting their financial statement, then is there any advantage of buying a franchise at all? It almost seems like more risk, because you are getting yourself into a long term “agreement” and promising to abide all of their rules.

    On the other hand, if you do start a company on your own, you have a higher chance to fail, but at least you are in more control over your firm and has flexibility to chance the rules as you wish. But, what about passive income you earn from buying a franchise? Do you really earn more passive income when you buy a franchise over starting on your own? Is more passive income through franchise is a myth?

  • February 5, 2010 at 4:42 pm

    Okay folks, now it’s just getting ridiculous. Every Liberty franchisee files a profit/loss report with the company every year. It lists how many returns an office did, what their revenue was, what their expenses were, and so forth. If you are looking at buying an existing office just ask for this. If they misrepresent this then you can sue their pants off. For all the criticisms I’ve posted of the company in this thread I have to say that I’ve never caught them in an outright lie. They will let you believe what ever pie-in-the-sky scenario you make up in your own head, but I’ve never known them to outright tell people a lie to sell a franchise. And I can’t see why a former franchisee would lie about his own experience. No reason anyone would do that. Calling former franchisees is probably better DD than calling current ones.

    These allegations of fraud slung toward Liberty are unfounded in my own experience. The company definitely looks after its own interests, but I defy anyone to show me any franchiser that does not.

  • February 6, 2010 at 1:30 pm

    Fraud is a subjective term. What Liberty does to franchisees and people who want to buy into their system would be termed as aggressive by some and downright lies by others. While it is true that human nature wishes to believe what ever the observer wants to believe, Liberty facilitates the illusions that a prospective buyer would want to believe. While they are careful to not go out and say a bold faced lie, they do subscribe to the illusion that you will believe what you want to with their guidance.

    It just seems that with the amount of contoversy related to this company, no matter the pros and cons, a possible purchaser of this franchise should be extremely aware of what their practices are.

    Most former franchisees are legally bound not to speak badly of Liberty (this clause is in the franchise agreement). If you are lucky enough to find someone who is willing to be candid, listen to them and sort out the information that would be useful to your decision. Liberty has been known to shop their franchisees for their opinions by posing people as possible buyers of the franchise and the franchisees are aware of this. That is why there would be some reluctance by the franchisees to tell the whole truth-there are certain legal reprisals that Liberty exercises on a regular basis. I know they pulled this on me in California where I had my former franchise.

    If it smells bad, it usually is…

  • February 6, 2010 at 3:58 pm

    In a legal context, fraud is not a subjective term. It is very specifically defined.

  • February 8, 2010 at 2:59 pm

    I guess the courts in Virginia have a different view-check those who have been sued by Liberty!

  • March 21, 2010 at 6:54 pm

    Keep in mind that when you sign your franchise agreement Liberty requires you to sign a personal guarantee. So no, it won’t matter if you had a corporation. I’m amazed at the ignorance of the people who bought Liberty franchises and don’t know this kind of information. It really is right there in the contract. It think too many people put on blinders and respond to the marketing sizzle, ignoring what is right in front of them in a contract.

    There are profitable Liberty franchisees. There are people who come and go. I’d say over half are not around after five years. Mainly because they are not suited to be self-employed, and of course Liberty isn’t going to tell them that. They collect $40k for a territory now, then 10% to find you a buyer if you aren’t making it, or they take it back when you breach your contract and sell it again for $40k. And on and on it goes. But people who can operate a business can do well. I don’t really know how you tell the difference, but Liberty needs to do a better job. Not doing it is profitable to them, though.

  • March 29, 2010 at 3:02 pm

    I am curious if Liberty requires a personal guarentee only if your are financing with them. Does anyone know the current interest rate they charge? It sounds like this was a first business for many of the people commenting here.

  • May 11, 2010 at 5:12 pm

    The problem may lie in the people making these postings. I am a first year franchisee of Liberty. We converted our existing tax practice into a Liberty Tax and are very satisfied with their support and service. Owning a business is not for everyone. As an owner of up to 5 business at any given time, I have to work harder than most people who have jobs. I don’t complain about that, I am happy to work harder because my family and I are the ultimate beneficiaries of the hard work and long hours. People who have jobs and work for others mostly work harder for the benefit of their employers with no real job stability or appreciation. If you like working 9-5, owning a business or a franchise is not for you. If you don’t want to risk the money you are investing, owning a business or a franchise is not for you. Keep it in a savings account earning 1/2 a percent per year interest. There are no free rides. If it were easy, everyone would be doing it. Liberty provides an excellent system and backend that if executed properly, works. There are over 2000 franchisees in the Liberty system. Most are very happy and profitable. Obviously the ones that are unhappy and/or didn’t preform well in their endeavor have posted here. Is the system perfect? Absolutely not. Is it much better than opening up a business on your own (as I have done many times both successfully and unsuccessfully)? It absolutely is.

    John Hewitt successfully founded and ran Jackson Hewitt which was sold for hundreds of millions of dollars. Liberty Tax is the fastest growing tax franchise ever. He has over 40 years experience in the tax industry. With that comes some people who weren’t a good fit for franchising, or for the tax industry or for owning a business in general. You have seen their postings above. Take them with a grain of salt. If you are interested in franchising with Liberty Tax, inquire with Liberty and you will get a chance to talk with John Hewitt himself. Opportunities like that are rare. He is a hands on CEO with a wealth of information and knowledge that he isn’t afraid to share (to his franchisees). If you have questions about the postings above, feel free to present them to John directly and he will give you the other side of the story which is not represented here.

    Goto Jackson Hewitt’s website and goto their investor relations section and listen to their conference calls and look at their financials. Better yet, search them on Google News and you will see that they are on the verge of failing. Then do the same on Liberty’s website. You can see the financials posted (even though they are not a public company, they still release their financial performance). You can listen into John Hewitt’s investor conference calls. He has a wealth of information about the tax industry as well as competitors H&R Block and Jackson Hewitt. During recent years, Liberty has increased market share each year while it other two national competitors (H&R and Jackson Hewitt) have lost market share and their client base. Don’t let a couple of disgruntled franchisees sway your decision before getting all of the facts so you can make an informed educated decision about joining a great company like Liberty Tax Service.

    Our numbers were up 40% this year after converting our business to Liberty. We are first hand proof that the system works.

  • June 10, 2010 at 3:43 pm

    Wow! I am former franchise owner of Liberty Tax Service. I would suggest that people run from this franchise. I believe Liberty has only its own interest at heart and this is a numbers game for them. They will suck you dry and move on to the next victim. I believe Liberty is unethical all the way up to the top. John Hewitt personally lied to me over lunch. They had me change to date I received they UFOC so they could sell me the franchise earlier than they were legally allowed to. I would say that is fraudulent. However I was younger and went along because I believed.

    Before I go any further for the people that will say I am undercapitalized, not right to own my own business, did not follow the system, etc. I have been self employed for most my adult life and currently run a profitable tax practice. I believe that Liberty makes it very tough to make a profit in this business. If things have not changed they take about 16-21% of your gross margin. After about a week into their system I realized that there wasn’t anything that I could have done on my own. I will say that they give you good guidence on site location.

    I did not expect to be profitable for the first two years. However, I followed their system for several year and still did not reach the average numbers they told me a first year store could expect. I was well capitalized and could afford the losses. The funny thing was I was profitable the minute I was no longer apart of their system. After having a running battle with the corp office over support and documentation issues I was sent a notice to cure. I refused to cure what they wanted till they provided me with what I wanted. They terminated my franchise when I did not cure. Which is what I wanted at that point anyway. I operated under my own name for the next tax season and had a great tax season. Then Liberty sold my area to another franchisee telling them that they would sue me and give them my clients.(i learned this later from a source close to the matter) Liberty is use to bleeding people dry so they have no ability to fight in these situations. Liberty lied in their court pleadings but they ran into someone that had the ability to fight back. During the time that I was with liberty I received very little support from them. I would not waste your money on this program. There is nothing that you cannot do yourself. Remember the reason most businesses fail is that they are undercapitalized. This is a business that you have to market. You can not just open your doors and customers come rushing in. Also you only have one shot a year in this business you better get it right.

    I will leave you with a couple of stories. First a franchisee that had been established for several years was approached by the franchisee in the territory next to his that had just opened that season and it was not going well. He wanted to do a joint marketing campgain offering free returns to help build his numbers. (Liberty marketing plan) Offering free returns will bring clients in for sure and if you can offer it is a great first year plan. However the other franchisee had been established and did not want to give out free returns. Liberty corp told the new franchisee to go ahead and advertise the free returns in the other territory. Now what is the other franchisee A going to do? Give out the free returns or lose the customers to franchise B? Franchise A paid for that territory and it should not be violated like that.

    I think with any franchise you are going to have people that are happy and people that are mad. I think you need to look turnover ratio of the franchisee’s. What John Hewitt and Liberty Tax are really good at are selling franchises and when those fail reselling the franchise to somebody else. I think Liberty Tax is very sucessful as a franchisor. Think about what you have read already Liberty will finance the franchise fee for you. That does not cost them anything. Then you work hard to build a client base up and when you fail they can resell your hard work to someone else. They do not lose a store and they keep making money off the franchisee’s. I am not saying Liberty should not make a profit however I don’t think they are as concerned about their franchisee’s success as they should be.

    For me it boils down to this, why pay 20% of your gross profits a year to a company that does not provide you anything special.

    Is their branding really that important?

    I think Mario could have increased his numbers by forty percent without Liberty. I don’t know if it was the location or the advertising that was lacking before but with a little research Mario could have done it on his own. It would be interesting to know what made such a difference with Mario’s practice. I think this market is getting very saturated and giving 20 percentage of your margin away is going to be hard on most practices. Better to spend 20 percent of your gross on advertising.

    For the few of you that are happy at Liberty and profitable Good Luck and God bless. I wonder how many of you think you get your monies worth for that 20%?

  • June 22, 2010 at 5:15 pm

    Please don’t buy a Liberty Tax. We bought an existing store and were open for 2 tax seasons before we decided it wasn’t worth the work and we didn’t make a dime, we actually lost about $150,000. The kicker was, when we were trying to sell the store, we found a few buyers who were rejected by the area manager (who, by the way, only makes his money by selling new stores.) We quickly saw that there was no way for us to win, so we closed our doors and ate our losses. The area manager literally said to my husband: “If I approve your buyer, what’s in it for me?” Liberty stresses that part of the value of your store is your ability to sell it once it grows, yet they make it impossible to sell it, and they win in the end.

  • June 26, 2010 at 3:23 pm

    Liberty and its area developers make a commission when existing owners place their territories on a commission agreement and then sell their businesses. So your story sounds untrue. Also, the company (and its area developers) get a royalty on sales. So why would they want a franchisee to just walk away rather than keep it running. That doesn’t help anybody. I’ve never heard of what you’re describing. And the “what’s in it for me” makes no sense since the area developer gets a 10% commission on the sale of an office. There’s no such thing as an “area manager” in Liberty. So I have to wonder if you were even involved with the company at all. Be careful of what you read on message boards, folks, because people with a vested interest in you not buying a Liberty franchise can also post here freely. Many many Liberty territories get sold, the company collects a transfer fee, and often collects a sales commission. So this is not a credible report.

  • June 28, 2010 at 9:11 am

    Wow Cosmic Zamboni, you are so transparent!

    Personally I believe Katie S. as my area developer in my territory did the same thing. As you clearly stated “when existing owners place their territories on a commission agreement.” the thing is ADs get more $$ when selling new territories compared to existing territories. Additionally, my AD in my territory would make no effort to sell the territories and then when the Zee would just walk away, he would either keep the territory (operate it himself) taking in the revenue and the commission or have another zee operate it without selling.

    Either way the ones that make the $$ is John Hewitt and the ADs (sorta like a pyramid scheme). By the way, I was invited to become an AD in 2008, I even attended the meeting in Virgina Beach and my hotel room and air farie was paid for by Liberty to woo me into purchasing an area. I read the agreements, I spoke to other ADs, and prior to being invited to become an AD I dined and wined with some of Johns elite, so I know for a fact that Katie S is spot on and you, well you are just a plant by Liberty.

  • June 28, 2010 at 11:40 am

    As a former franchisee, I can agree with most, if not all, of the comments and observations posted on this board. I completed my five-year agreement and chose not to renew….that in itself should answer most peoples’ questions about Liberty.

    Some locations are extremely profitable as they are situated correctly and run by knowledgable owners and staff but they are the exception to the rule. My offices were “profitable” by the fourth year but not enough to support ME.

    Finally, I had enough of Hewitt and his minions. Each year, there was a new cadre of eager beavers swallowing Hewitt’s Kool-Aid. I’m paying for experienced people and not newbies.

    There’s not enough air in the room when John is in there and also, they pulled our Yellow PAge ads in favor of web phones; that killed my RAL business.

  • July 9, 2010 at 12:39 pm

    My experience is that after several years of trying and multiple offices I am bankrupt. This is not only my experience, but I know 4 other franchisee’s that are in the exact same position as I am at this same moment. They are all capable, successful in other businesses, entrepreneurs, and yet finding themselves bankrupt. I don’t know, is there a pattern here?

  • July 16, 2010 at 1:43 pm

    My experence after several years of running multiple offices is after I quit making things difficult and simplified things I am making money!! I also know multiple other Zs who are also succesfull in other areas and businesses and they too are making money because they figured out the same things I figured out and they are no where near bankrupt. I don’t know either, is there a pattern here also?

  • September 28, 2010 at 1:07 pm

    I recently heard from one of the “Successful” franchisees who owns many offices about deals that are made with certain zees that are seen as successful. Unfortunately these special finance arrangements etc are not available to those of us who have one or 2 offices are struggling to make it work or learning how to “simplify thing”. I also was told that there are a very large number of Liberty offices closing this year. Gosh I wish I could have recorded that conversation. It was quite interesting.

  • November 21, 2010 at 1:43 pm

    I’m a former franchisee. I have been sued by Liberty. I am also bankrupt because of Liberty. This is not an exclusive club of unhappy franchisees! Pay Attention to what is said and remember that Liberty regularly monitors and contributes to this site.


  • December 28, 2010 at 12:19 pm

    I am the husband of someone who has been a Liberty franchisee (1 store) for 2 1/2 years now. I was leery of the investment from the start because I knew it would take a lot of time away from the family, including our young son. She didn’t (at the time) think that would be a huge factor, but has since learned otherwise, as she has put many long hours in at the office. She has had decent success with her store (located primarily in a lower income neighborhood in the midwest), despite some theft and dishonesty from one of her former managers. And she has had a lot of good support from Corporate.

    About two months ago she signed on the dotted line to become an Area Developer, financed thru Corporate. In visiting the other franchises in her territory, she has discovered that two of them are so poorly run that she is thinking about buying them out. Her intention and goal upon becoming an AD was that much of her ‘work’ could be done from home with phone calls and such, and her traveling would be minimal. Once again, this has proven not to be the case, as she works ALL the time now and it is not even tax season. She is practically nonexistent now as a wife and mother.

    I’m just throwing this out as a warning flare for any potential franchisees (and their spouses) who may wonder how much time it takes to SUCCESSFULLY run a Liberty store. If you think it can be done comfortably from the perimeter while watching a manager run your store(s), think again. It takes a LOT of time and effort. If that’s what you’re into, more power to you. But if you have a family that may potentially suffer as a result, I feel for them.

    All of this said, I am still very leery of the overall Liberty concept, particularly given what has been said in these many posts. I don’t want to have to eventually say to her “I told you so”, but have a sneaky feeling that I will someday. And unfortunately, we’ll probably no longer be married when I say it.

  • December 28, 2010 at 12:56 pm


    Here is some food for thought. Liberty Takes about 20% of gross I believe. What do they do to deserve this? After the first week with Liberty I realized I had made a mistake. Their system was not anything that I could not do on my own. Think about this for a second. What if your took the money that you were paying Liberty and used it to hire a full time person to market for your store. Do you think you would have more returns and make more money? I not apart of Liberty anymore. Yes I was sued. No I am not bankrupt. I am well capitalized and had money to fight. My suggestion is that none of these tax franchises are worth it with the exception of maybe HR Block. They do have brand value. I am not sure that they are worth it either but if any of them are it would be Block.

    My advise is to anyone thing about doing one of these tax franchises is don’t. Do it yourself. Also diversify your income streams. If you don’t know how to run a tax operation work for one of the big three for a year or two or hire someone that is successful to help you set up your office.

  • January 12, 2011 at 6:19 pm

    I suggest that Liberty is playing with the numbers. They may have sold 3200 franchise territories, but can also tell you there are many that do not have open offices and are paying minimum royalties. I know of several in my area, so I have to think there are several hundred across the country. As to how many of the existing are viable, probably less than 50%. Not to say they are not profitable, but in many cases making far less than $10K per year. About like many of the customers who walk in the door. How great it is, you now qualify for EIC as a Liberty Tax franchisee !

  • January 12, 2011 at 7:59 pm

    You really should get a life. Should change your handle to Disgruntled. The office numbers are correct. Any unopened offices in sold territories are in addition to the open office count which is accurate. Where did you get your information about only 50% being viable? My guess (at least I state it when I’m guessing) is that you pulled it out of thin air. All potential and existing franchisees are given the names and phone numbers of all existing and previous franchisees and are free to call them before making their decision. Just because a small percentage of people fail does not make the system not viable. In most cases, it means the franchisees were not viable and they did not follow the system or were not capitalized enough to open up a business. Survival of the fittest is the way of business. No one will hand anyone anything. In any business you have to work hard and make the right moves to succeed.

  • February 3, 2011 at 2:42 pm

    I was looking at buying a Liberty Tax Franchise, but some of the information here is pretty scary. What have some of the former Franchisee’s been sued for? Obviously it sounds like most here have ended with financial issues. What would they get if there is no money?

  • February 3, 2011 at 4:01 pm

    Very interesting stuff,

    I think there are different reasons to sue. I don’t think that it cost liberty that much to sue since they already have a in house legal team. They get to sue in their home district. The following are some reasons for Liberty to sue.

    1) protect the brand by scaring past and present franchisee’s to not say anything bad about the brand. You will notice that most people saying anything negitive about liberty past or present are doing so without saying who they are. Why because they do not want to be sued.
    2) I have heard of Liberty suing a former franchisee trying to take over or force them out of business because they decided not to renew and just operate on their own. That would save you almost 20% a year.
    3) They could sue because they don’t like a franchise because they are a trouble maker and stopped drinking the cool-aid and want them out and want to resale their territory.
    4) I also heard of a case where they promised a new franchise that they would give him a client base by suing a former franchisee and taking over his business in the lawsuit.
    These are just a few things I have heard. I am not saying they are true. However, if you crawl into bed iwth Liberty Tax just beware that they are more than willing to use the legal system to do whatever it takes to protect themselves.

  • March 12, 2011 at 3:41 pm

    If I do not renew my contract when it expires this year will I be sued by Liberty? That sound pretty scarry but I think I would be more profitable on my own. I do not believe I have met profitable franchisee.

  • March 12, 2011 at 7:38 pm

    No, you have the option, as does LTS, to not renew your 5- year agreement without any repercussions. However, if you choose not to renew, you have to “walk away” completely. I would try and sell it using LTS or your AD.

  • March 12, 2011 at 8:48 pm

    I think “current franchisee” is asking if he continues to run his business as an independent after his franchise agreement expires, will LTS sue him for violating his “post-term covenant not to compete.”

    My understanding is that this varies quite a bit on a state by state basis. For example, in California, it’s my understanding that post term non-compete agreements are not enforceable and there’d be nothing they could do. Your state may be a different story.

    I’d strongly suggest you get the advice of an experienced franchise lawyer who can explain the enforceability of the non-compete in your specific situation, and also research how Liberty Tax has handled the same situation in the past.

    Please let us know what you decide and how it works out. Good luck!

  • March 14, 2011 at 7:26 pm

    Current franchisee;

    If your married and your spouse didn’t sign the agreement he/she could open the business and hire you. That wouldn’t violate your non-compete.

  • June 8, 2011 at 9:21 pm

    After looking into it looks as if my state does not enforce the noncomepte unless you have made over middle class wages. Which would be 62,000. Liberty has not. Looks like I will be waiting it out.

  • September 23, 2011 at 4:51 pm

    I am glad I found this forum. I’ve been contemplating buying into this franchise to help my CPA tax practice grow significantly using Liberty’s marketing techniques. I know how to run an office and motivate trustworthy people. But I don’t like what I’m reading on this forum in how Liberty is dealing with the franchisees. I live in southern NJ and probably the best DD I can do is go talk to some of area owners and feel them out. If anybody else is a NJ owner please let me know. Sound’s like I’m better off building my tax practice on my own.

  • September 24, 2011 at 11:57 am


    You don’t need Liberty’s marketing techniques. Instead of giving your money to them, take the $40,000 for the territory and the 19% royalties and pay a marketing company to help you promote your own business, you will be much better off and will retain control of your practice.

  • September 25, 2011 at 11:34 am

    You are right Mike. Are you a former franchise owner? Thanks.

  • September 25, 2011 at 12:01 pm

    Barry, speak to your rep; as part of the process of becoming a Liberty franchisee, you are disclosed a list of every current and former franchisee the company has ever had. Obviously as stated here, there are some people that are unhappy. Most of us are happy. Most of us are making good money. Most of us love working really hard 4 months of the year and doing what we want the other 8 months of the year. Most of us are very happy with all of the robust support and branding that Liberty offers to all of their franchisees.

    Sean, that lawsuit is baseless and was really filed against Annie Fuller who was a rogue franchisee who was committing fraud and who turned against the company after she got caught and is trying to say that the company encouraged the fraud. The lawsuit will be thrown out. Liberty never encourages any fraud and never encourages any increases to pricing. In fact, Liberty will encourage franchisees to lower prices if they charge too much based on local market conditions. Liberty has a large internal audit division that audits tax returns, offices, franchisees and tax preparers to make sure fraud is not happening. Ms. Fuller’s actions were not those of Liberty, she is only trying to save her own behind by blaming Liberty corporate. 5 instances out of millions of tax returns prepared are mentioned there. Liberty’s compliance will be shown to be excellent if that case ever gets to trial.

    Mike, all Liberty franchisees do have control of their own business. Liberty does not charge 19% royalties, they charge 14%. There is not a marketing company on the planet that can achieve the marketing results that we do at Liberty. We have grown in paid returns every year for the past 13 years while our other national competitors have shrunk in paid returns every year for the past 8 years. We have over 1,800 franchisees and just under 4,000 offices across the country. Most of us are very happy to be part of this company. There are always some unhappy people at every company and sometimes it is not the fault of the company or based on personal circumstances of the people. The support from corporate does not end with marketing and branding; tax support, tech support, financing support, pr support, real estate and leasing support, payroll support, tax preparer certification support, tax school support, free individual and corporate tax software, discounts from large vendors due to scale, comprehensive training for franchisees on how to operate, thrive and expand, bank products and access to the most experienced person in the tax prep industry, our CEO John Hewitt are just some of the many things that come along with being part of the Liberty family give our franchisees.

    I am the proud owner of 6 Liberty Tax offices and going into my 3rd Tax Season with Liberty.

  • September 25, 2011 at 10:22 pm

    LibertyWay: At least a Liberty supporter that tries to make sense. I will give you this, The lawsuit against Anne is suspect. Since you are going into your third season you probably aren’t familiar with “doing the Anne way.” You are probably also not aware of Liberty paying her over $300,000 to go away. God Bless you my friend, I hope you make lots of money, with Liberty, just look at your Balance Sheet and be careful. Don’t get too over extended, you have 6 offices and going into your 3rd season sounds like you maybe heavily indebted to John I Screwitt.

  • September 25, 2011 at 10:41 pm

    Thanks Mike, we’re not heavily indebited. We have been profitable each season and rolled that money back into expansion. Liberty paid Annie to buy her offices back because she was being sued for fraud to get her out of the system. John has been nothing but a gentleman and his insight on the conference calls and at convention and through emails has been amazing. Have a great night! ;)

    “Success is planned, it just doesn’t happen!”

  • September 26, 2011 at 9:00 am


    I am a CPA and was involved with a franchise in Atlantic County NJ that is now closed. There is no brand awareness outside of people like you and me who are in the tax prep. industry and looking to grow a practice. As for marketing the company dosen’t do any it’s all on the shoulder’s of the franchisee. I would be glad to speak with you.

  • November 22, 2011 at 6:46 am

    A fool and his money are soon parted. I look at this franchise a few years back, meet John and his staff, and after talking with a few local franchisees, I “ran” away.

    I kept my money that would have been spent, and went to law school. Now, as a tax attorney, I charge over $300 per hour to do tax work and I pay no royalties to anyone.

    Thanks, John, you helped me learn that the best way to succeed, is to work hard. You can not buy success “in a box,”. You must earn it everyday.

    Invest in yourself, not a franchise.

  • May 14, 2012 at 6:30 pm

    @Trisha Grabert… I am a first yr liberty franchisee and already am having problems with them. Is it possible to talk to you via email or on the phone. I am so lost as to what I can/should do.



  • May 14, 2012 at 10:34 pm

    Amy, Try speaking to your Area Developer or post an incident on support central or post on the company discussion board and I’m sure someone will help.

  • May 15, 2012 at 11:18 am


    You did the right thing by posting here. Your Liberty AD should have been there in the first place, they should have been out there “waving” if need be too help you get more clients.. But did they? They see your results just as you do, did they help? Now if you go and post on the discussion board, they will know who you are! They should have helped you LONG before you ever thought of posting here,

  • October 25, 2012 at 9:31 pm

    If you buy an existing LT franchise, will u be required to pay an initial franchise fee? Also, what are the procedures? Thanks for any insights.


  • October 26, 2012 at 7:35 pm



  • October 26, 2012 at 8:57 pm

    If you decide to buy, try to get a decent price. Figure out how much you will need to bring in to cover any payments you’ll have to make. Check out accounting practice Don’t forget asking price may not be the price paid. Look out for yourself first.

  • October 27, 2012 at 12:49 pm


    PLEASE don’t do it!! Take your money elsewhere. Seriously. PLEASE don’t buy into these scumbags. You will regret it, I promise you that.

    We are past franchisees and had a lot of prior Business, Tax and Accounting experience. They were no help to us at any point in our 5 year contract. They were all too happy to take our money and it was horrendous trying to get help from AD or Corporate…..

    I cannot go into it on this forum, but trust me, it is a useless company with useless leaders and they go after your money and nothing else.

    You can do better on your own or elsewhere. I say that to whomever is looking into this franchise……..buyer beware and run the other way.

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