H&R Block Tax Software Deluxe Federal + State 2023

Summary: A software problem in the HR Block Tax Deluxe + State 2023 program caused a significant error/underestimation (~$1,000) of the Lifetime Learning credit calculation on my return. After notifying tech support with ample evidence of the error, HR Block (HRB) strung me along and never corrected the error in the software (which is likely impacting other users of the software). Nearly four weeks after this ordeal began, I was offered the solution of overriding the error in the software, which would require that I mail my return to the IRS instead of e-filing it, or re-entering all of my information into the HRB online product to see if it would generate the correct credit and return. (I did this, and the credit was calculated correctly.) Although I was provided a refund for the software and a free online return, this ordeal was equal parts exhausting and infuriating. I have lost all faith in HRB, and I strongly discourage anyone from purchasing this product. Read on if interested in more details. I have used HRB tax preparation software for ~20 years, dating back to the Tax Cut days. Other than a few awkward data entry items, I never had a problem with the software. That all changed while preparing my 2023 return. My younger son could still be claimed as a dependent in 2023, is in college, and receives education and athletic scholarships. We planned to claim the Lifetime Learning Credit (LLC) on our tax return to partially offset our qualified education expenses since we exhausted the preferred American Opportunity Tax Credit (AOTC) option on our 2022 return. After shifting some of our son’s scholarship income to his personal tax return, we had $5,010 of qualified expenses available that would result in a $1,002 LLC (20% of qualified expenses). That’s what the HRB software should have calculated after responding to the software’s interview questions. Instead, it generated a $0 credit. I spent hours checking to see if I made a data entry error and read up on IRS publications and instructions. At every turn, I remained convinced we were eligible to receive the credit. The software even showed the correct amount of qualified expenses next to my son's name in the interview summary despite the $0 credit calculation. I checked the HRB 2022 and 2021 software editions that are still on my PC. There , I noticed that the 2022 software also listed the LLC credit value as $0, but that had no impact on me since we were still eligible for the correctly calculated AOTC. The 2021 software did show a non-zero (correct) value for the LLC. It was pretty obvious at this point that there was a software problem in the 2023 software and possibly in the 2022 software as well. I reached out to HRB via live chat. I was told a software update would go out at the end of the week which would likely address the problem. It did not. A follow up chat went nowhere, and I made my first call to HRB customer service. Although everyone I talked to in customer service was generally cordial and patient, the initial assumption was that I was likely mistaken and was frequently asked if I had spoken to a tax professional. I was essentially stuck at this point. If I overrode the incorrect $0 credit with the correct amount, I would be unable to e-file. If I filed my sons’ returns, which were accurate, I would be ineligible for a refund. I made the reasonable request that HRB fix the software glitch and provide a reasonable path forward and timeline for me. Lengthy and frustrating phone calls with customer service continued. I finally convinced a rep to escalate my case on Saturday, March 16th. On Monday the 18th, I received a call from an escalated support rep. She was very helpful and was able to replicate the error on her version of the software. She informed me that my case would then need to be further escalated to Tier 3 (T3) support and gave me instructions on how to upload my return through the software for T3 analysis. I really felt I had finally made a breakthrough. I was wrong. On Thursday, March 21, I received an email from HRB product support that repeated the data entered into the education expense interview in the software and said the following: “Based on your entries, your dependent is not eligible for the Lifetime Learning Credit. You indicated the tuition payment was $xxx, but you received grants and scholarships in the [greater] amount of $yyy. Since your grants and scholarships are greater than your actual tuition costs, the credit does not apply.” This was an erroneous interpretation of my situation and a blatant violation of Tax Return Logic 101 since we had reallocated some of the scholarship funding to my son’s income. And, this was sent to me after my case was escalated to Tier 3. Some “sternly worded” phone calls with customer support followed, yielding a series of shaky excuses, a lack of understanding of the tax situation, re-escalation, and several broken promises of returned phone calls from supervisors and tech support. Looking for options, I spent considerable time re-entering all of my tax information into the TurboTax online product which calculated the correct credit. I alerted HRB to this fact. A helpful rep took the time to re-issue a new case number and was able to replicate the error in the software, but again, I did not receive timely follow up communications of any meaningful value. Entering the month of April, I became convinced HRB was trying to wait me out to the point I would have to ask for a refund. I continued to follow up with phone calls. On April 4, a rep suggested I try to enter my tax data into the HRB online product and offered a passkey to pay for the product/e-filing if the credit was calculated correctly. Reluctantly, I spent another ~2 hours that night giving it a try. The online product made the correct calculation. After another 1+ hours on the phone on Friday, April 5th, I negotiated a deal and filed my family's returns that night for no charge (1 online and two on the software). However, the final slap in the face in this whole ordeal came on Saturday when an escalation rep called me. She obviously had not read the updated notes on my case as she offered me the option of overriding the erroneous credit amount in the software and mailing my return to the IRS or re-entering my tax data the online product (which I had already done). There was no indication that the software glitch would be fixed. I could have mailed my return ~four weeks earlier, but what’s the point of doing that when you pay for e-filing with the software? Plus, what is the potential impact on other filers who may be, possibly unknowingly, impacted by the same error I was? When prompted, the HRB rep offered no response other than technical support was aware of the problem. Meanwhile, the software indicated that no further updates expected before the IRS deadline. In short, the 2023 HR Block Deluxe tax prep software contains an error that prevented the correct calculation of the Lifetime Learning credit on my 2023 return. The error was likely in the 2022 software as well. Current year TurboTax and HRB online products do not contain the same error. It’s reasonable to assume other tax payers attempting to claim the LLC may be impacted by the same error. I contacted HRB customer service about this problem in mid-March, and they were unable, unwilling, or unconcerned enough to resolve this issue after I spent a massive amount of time trying to get a reasonable and timely resolution to the problem. I have lost all trust in HRB. I strongly caution you when you consider purchasing this and future versions of HRB tax prep software.