The H&R Block lawsuit is one that has been making its way through the court system for several years now. A federal class action suit was filed against H&R Block and the company in 2002 after an employee was injured on the job. This case was eventually settled in 2003 with the consent of both sides agreeing to never repeat the actions. But there is still the question of whether or not the company was guilty of any wrongdoing or not.

IRS Scam – H&R Block Lawsuit

On the matter of the actual lawsuit itself, a local judge in Idaho saw things a little bit differently. According to court documents, the plaintiff originally filed a complaint against H&R Block with the Equal Employment Opportunity Commission (EEOC) and the Federal Bureau of Investigation. According to the initial complaint, this tax preparation firm did not make any efforts to correct the problems that it initially faced regarding employment discrimination.

Instead, the company allegedly used a variety of inhumane ways to discriminate against its employees. These include forcing employees to use specific keywords during tax preparation sessions, forcing employees to use specific codes during H&R Block tax preparation, requiring employees to use specific tax preparation software, and requiring employees to submit completed IRS tax forms via UPS or FedEx when they tried to file electronically.

The lawsuit was eventually moved onto the United States District Court for the District of Idaho.

The plaintiffs were able to claim back over six million dollars from the H&R Block in refunds and additional damages. The exact amount of damages claimed was over seven million dollars. It was actually found within the documents that H&R Block actually had an understanding of the tax laws that would allow it to inflate the tax return figures it submitted to the IRS in preparation for the tax refund anticipation.

While this settlement may seem like a large one, it pales in comparison to the actual amount of money that was recovered by the IRS.

In its attempt to recover the money, the IRS actually reached a deal with H&R Block to settle for a lesser amount than the original amount. What makes this even more amazing is that according to internal documents obtained by the Government Accountability Office (GAO), H&R Block made over twenty billion dollars in tax preparation deals during the year .

A deal would have been much worse for the government if it was proven that H&R Block deliberately understated tax preparation profits in order to secure the largest possible tax refund. Today’s ruling provides the government with yet another excellent opportunity to get compensation for the injuries caused by H&R Block’s actions.

This is not the first time that an individual has lost their case after going through a H&R Block tax preparer’s scam.

Last year, a similar lawsuit was brought against H&R Block by the heirs of a deceased corporate investor who had invested in H&R Block’s direct selling retirement accounts. The heirs claimed that H&R Block did not disclose key information about the profitability of its deals and did not allow them to sell their retirement accounts before they died.

Both the H&R Block lawsuit and the lawsuit brought against H&R Block by the former retirement accounts’ heirs were eventually dropped by the U.S. Attorneys General.

But just days after the dismissals, attorneys General Eric Holder and Loretta Lynch revealed that the Department of Justice was reviewing the matter. It is possible that these two cases could be revived shortly, if the United States Attorneys General will take a more aggressive stance on “shell game” type lawsuits such as the ones brought against H&R Block.

Many expect this to happen soon, especially after Attorney General Eric Holder said in an interview with CNN’s John King that he would be looking into whether H&R Block acted appropriately in receiving its tax refunds.