In our district Friends and Family returns are now being accomodated as part of the tax pro's Wallet. Previously one could do either 5 or 15 free returns for friends and family members, depending on when the tax pro was hired. Now the tax pro's coupon "Wallet" is going to be loaded with a certain amount--depending on longevity--and the tax pro's can allocate whatever amount of discounts they want (up to the limit of the amount in their wallet) for both Friends and Family Returns and for discounts to regular clients. As you might guess, this new approach is none too popular in our district.
Is this going on throughout all the districts in the company? I can't help but wonder why Block WHQ apparently thinks that now is the time to be alienating the tax pros, given that current legislation may mean that there will be a shortage of tax pros next year. Another consideration is the possibility that tax pros may start using Turbo Tax or other non-Block preparation programs to do returns for friends and family members, which would certainly lower the Block's number of returns prepared.
I believe it is nation-wide. The idea isn't that bad, but the amount in the wallets is way too small for the amount of returns it's supposed to cover. I look at it as another cost-cutting measure that will have unintended consequences. HRB will probably save some money by, in effect, putting a "cap" on the discounted returns, but will see a decrease in the number of returns as a result. I'm already in the process of deciding which of my family will stay with Block and which ones get to figure out some other way of getting their taxes done.
Block has messed with Friends & Family returns for some time. When I started working there it was unlimited, then the number was capped. Since I had been there for some time, my cap was higher than that for newer preparers. Sometimes I would "lend" my excess to other preparers, who really did have large families. We used to be able to discount returns for clients who freaked at the price, but that practice was ended. No Code 4s (If I remember the number right) were allowed without OS approval. Since I left, the company has come up with the wallet, allowing measured discounts. The fact that they have folded F&F into the wallet says something.
The message I see over this history of changes is that there was preparer abuse. I know of one preparer who was literally walked out of the office after it came to management's attention that anyone paying cash was a F&F, and some of those paying with checks were told to make them out to the preparer (also entered as F&F). The Code discounts were often given by sympathetic prepares who couldn't believe how much their client's price had gone up. Some were just too sympathetic I guess. I was always in the opposite camp, adding time charges to returns that took a lot of time to get done. I guess I never was one to give away my work.
My reading of this history is that preparers abused the privilege of doing returns for their friends and families for nothing, or discounting prices for clients they favored. The abuse would never have gotten so out of hand if the company had given their preparers some respect--treated them as professionals and trusted their judgment (which they used to do in the old days). By treating them as high school kids trying to get away with something, or as idiots who couldn't read the clients sitting in front of them, they asked for the abuse. Management was forced to keep tweaking the rules, which only enticed their employees to find creative ways around them. Sounds exactly like how the tax code got to be so complex.
I have never understood why someone would want to do their and family member returns on company sowtware during work hours. I would rather pay TaxAct $18 for professional grade software and do it at home. I dont want to carry my return information around and risk losing or having stolen. When at the office working i want to be earning money.
Years ago in a Skills for Success class one of the topics was pricing and "you are worth it". The idea was to "puff" up the staff allowing them to see their knowledge and experience was of high value. A lively debate followed, as there were some that complained about so and so discounting too much to retain clients, and if client did get another preparer the following year they couldn't charge full price, as client KNEW the price could be haggled. We also talked about F & F and why we thought we had to give our services away free. The point of being a professional was working to earn a paycheck, and our F & F should honor that.
During Block's growing years it was easy to ask the DM if we could do our plumber's or mechanic's return for free, as a "special" favor, and because Block wanted the numbers it was always OK ed, even allowing us a "gift certificate" where we earned our commission on that free return. The thought pattern was after a free return, the client may well turn into a paying customer.
The first few years doing taxes, I admit I had a hard time charging a lot, as I was aware of how much I didn't know, and I liked Block's policy of newbies NOT getting complex returns, or new clients. Most of the time it worked, some times it was only a newbie there, or a greedy newbie that wouldn't pass it to a pro cause they were drooling over the commission.
Now, when I'm asked "how much is this going to cost me?" I jokingly say, "I'll keep it under a thousand", or answer "plenty", or "it all depends on how hard of a time you give me". I've had no complaints (OOPS, yes, I had one: Charged a lady $75, she complained it was too much and she'd never come back. It was a $225 return, she wanted to pay $25. I was glad to get rid of her.)
The sad news is there is a "tipping point" on the price of a return. When a K-1 generates 5-7 other costly forms, or if a Sch A or C has depreciation, 179 expense, mileage, OIH, etc., the bill adds up fast. AND, while my experience and knowledge is worth it, I have to be aware of losing clients because of it. I have to be aware how many CPA's in our area are doing returns for $250- $350.
I'd rather discount down to that amount and retain the client. $200-300 is always better than zero dollars. (That's what Block told me in their training class).
I still do F & F for free (again trained by Block), some are really appreciative and I get a present, like a home make quilt, or flowers on my birthday, others just take me for granted, like I'm family and owe them my services. Maybe Block has a good idea with ending that practice that has allowed too many F & F's to take advantage of what we worked so hard for. Ending how many a pro can do is a start. Telling an Aunt, Uncle, Cousin or neighbor you have to charge may just get rid of the ones who take you for granted? Thinking "I am worth it", is both liberating, and powerful in knowing you are a professional and get paid GOOD because of it.