Tax season is upon us and most every one has “a guy;” the guy—or gal—that does your taxes. Some people choose to roll their own, others use online applications from Intuit and others; while many may go to a local tax preparation service that just blew into town like H&R Block.
Companies like H&R Block have a sweet deal going down with their tax preparation services. First of all, they keep costs down with seasonal office leases and labor for its tax preparations; some as independent contractors.
Of course they charge a fee for tax preparation, but that’s just the beginning. Like Joe Camel selling cigarettes, it appears that tax preparation services are targeting poor people that need their money now.
A former H&R Block tax preparer I know says the real cash cow for the company is based on customers that really don’t owe taxes so much as they want to get their taxes filed so they can get a check from the government for being poor. And, they want the cash now; not 7-10 days later in the mail.
Now.
So, even though some preparers try to make sense to these desperate people and beg them to wait for the check, their clients are in such a rush for the free cash from the gubbermint they happily pay the 20-percent loan fee to get instant rewards cash from the Treasury. The reasoning is heck, this is “found money” from the government anyways, like you found it on the street; so why worry about the vig?
Multiply that by the hundreds of outlets in most metro areas, and you begin to see the razor from the blades. Could it be that the business model is based more on separating poor people from a chunk of their welfare check then it is about actual tax preparation?
We’ve all heard about the debate over the regulation of Pay Day loan operations and their lending practices that feature exorbitant interest rates. We wonder why outfits that do the same loan-sharking—disguised as tax preparation—are not also included in the class of predatory lending?
Furthermore, one can only wonder at companies that are designed from the ground up to chase welfare checks like some ambulance chasing parasite. Finally we need to question a corrupt welfare system that creates bottom fishers that can feed off the system.