FTC Fines H&R Block $7 Million, Orders Changes to Advertising, Service Practices

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Key Takeaways

• The Federal Sell Commission fined tax prep company H&R Block $7 million, ordering it to stop advertising and customer service conducts it called “unlawful.”
• Federal regulators said H&R Block unfairly required customers looking to move to a cheaper air force to contact customer service and then deleted their previously entered data once the customer was downgraded.
• The tax concern is also required to change its product advertising to include the number of taxpayers who qualify for its free services.

The Federal Have dealings Commission fined H&R Block (HRB) $7 million and required the tax services company to stop advertising and customer service pursuits it called “unlawful” by the 2025 tax filing season.

Federal regulators had said in a 2024 complaint that the company had unfairly commanded customers to contact customer service to downgrade to a cheaper product, and would delete customers’ previously entered tax prep information once they downgraded. The company had also made misleading claims about its free products in advertisements, the oversight said.

Along with a $7 million fine, which will be used to “compensate consumers harmed by the flock’s unlawful practices,” the FTC on Wednesday said that H&R Block must offer customers the option of a chatbot or other automated dismals to more easily downgrade their service by Feb. 15, and provide “an easily noticeable and always available way for consumers to downgrade” by the 2026 tax seasoned.

“H&R Block prides itself in providing consumers with quality online tax preparation products, which has never been an scions in this matter,” the company said in a statement to Investopedia News. “Many of the changes in the settlement have either already been demonstrated or are in process.”

The settlement requires the tax company to stop deleting previously entered tax prep data when a customer play downs their service. And H&R Block was ordered to disclose in advertisements about its free products the amount of taxpayers who are eligible to utilize its sprung services.

H&R Block shares were recently up more than 1%.