H&R BlockFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A H&R Block franchise requires a total initial investment of $34K – $159K, including a $3K franchise fee and an ongoing 0.6% royalty[2]. The 2025 FDD does not disclose unit-level revenue (no Item 19). SBA 7(a) loans show a 5.6% charge-off rate across 54 loans[1]. Verdict grade: F. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $34K – $159K
- 9th pct Financial Ser…
- Avg gross sales
- N/A
- 30th pct Financial Ser…
- Royalty
- 0.6%
- 2nd pct Financial Ser…
- Units
- 8,688
- 67th pct Financial Ser…
- SBA default
- 5.6%
- system-wide median varies by category
Quick verdict · Financial Services · color = vs category peers
Green = >15% above Financial Services avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Franchising since 1957. Systems this mature have refined operations and brand recognition.
Franchised units fell from 2339 to 1987 over 3 years. Investigate why operators are leaving.
Large franchise systems benefit from brand recognition, supply chain leverage, and proven operations.
Bottom line
- Total investment $34K – $159K including a $3K franchise fee, 0.6% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict F (Bottom Quintile) with a risk score of 95/100. SBA loan charge-off rate of 5.6% across 54 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Bankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- H&R BLOCK TAX SERVICES LLC
- Parent company
- H&R Block, Inc.
- Predecessor
- granted franchises
- Prior franchisor entity
- Incorporated in
- MO
- HQ
- One H&R Block Way, Kansas City, Missouri 64105
- Auditor
- Deloitte & Touche LLP
- Audited financials
- Franchisor revenue
- $3.6M
- vs $3.8M prior year
Independent franchisee associations
- Independent Franchisee Association
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Affiliated brands
- Emerald Financial Services
- Franchise Partner
- the Proprietary Marks used in the System
Other brands the franchisor or its parent operates (Item 1).
Overview
About
H&R Block franchisees operate tax preparation and filing services, serving individual and small business clients during tax season and year-round. Franchisees manage client intake, tax return preparation (often using H&R Block's software systems), filing, and ancillary services like audit representation. Day-to-day operations include customer consultations, compliance with tax law and IRS requirements, software management, and staff training.
- CEO
- Curtis Campbell
- Headquarters
- MO
- Founded
- 1955
- FDD year
- 2025
- States available
- 49
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $3K | $3K |
| Working capital (3–6 mo) | $430 | $12K |
| Equipment, build-out, other | $31K | $144K |
| Total initial investment | $34K | $159K |
Source: H&R Block 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $34K – $159K
- Better than avg vs category
- Liquid capital req'd
- $430 – $12K
- Better than avg vs category
- Franchise fee
- $3K – $3K
- Better than avg vs category
- Royalty
- 0.6%
- percentage · typical 6–8%
- Ad fund
- -n/d
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 0.6% of gross sales |
| Transfer fee | $3K |
| Inventory (initial) | $500 – $2K |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Financial Services averages
How H&R Block Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 8,688
- Opened
- 1
- Last reporting year
- Closed
- 31
- Turnover rate
- 0.4%
- Company-owned
- 6,701
- Corporate units in the system
- % franchised
- 23%
- vs corporate-owned
- Net growth (yr3)
- -6.9%
- Net unit change last year
- 3-yr CAGR
- -15.0%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 2
- Transfers (3yr)
- 26
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 50 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
Available to sell in · Item 12
- California
- Illinois
- Indiana
- Michigan
States where the franchisor is registered to sell new franchises (FDD registration filings).
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 54
- Loan volume
- $8.6M
- Median loan
- $100K
- 50th percentile
- Charge-off rate
- 5.6%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 94.4%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 41
- Defaults
- 3
Vintage analysis
H&R Block charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into H&R Block's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 5-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
H&R Block presents HIGH RISK due to system contraction, aggressive royalty structure, absent financial disclosures, active litigation, and unprotected territory—making ROI validation impossible and franchisee success uncertain.
Litigation (Item 3)
7 case reference(s): 0 pending, 4 settled.
Largest disclosed settlement: $660,000
Bankruptcy (Item 4)
Disclosed in last 7 years
Bankruptcy Code or any foreign bankruptcy laws required to be disclosed in this Item.
Audited financials (Item 21)
Yes · Deloitte & Touche LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 95 / 100 rating
- 01MINORDeclining unit count (-6.9% YoY) suggests system contraction and potential market saturation or franchisee dissatisfaction
- 02MINORExtremely high royalty structure (60% on first $5,000, then 40%) consumes majority of early-stage revenue, creating cash flow pressure
- 03MEDNo average revenue or net income disclosed in FDD Item 19, making ROI projections impossible and preventing informed investment decisions
- 04HIGHMultiple active litigation matters including FTC settlement, class actions on deceptive fees, and restrictive covenant disputes indicate compliance and reputational issues
- 05MINORUnprotected territory exposes franchisees to direct competition from other H&R Block franchisees and company-owned locations
- 06MINORDeclining system size suggests fewer operational references and reduced collective bargaining power for franchisees
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Territory type | Address or Map |
| Protected territory | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | Missouri |
| Litigation count | 8 |
View Item 3 litigation summary
7 case reference(s): 0 pending, 4 settled.
Items 10, 11
Training & Operations
- Classroom training
- 42 hrs
- On-the-job training
- 19 hrs
- Training location
- On-site and corporate
- Site selection
- franchisor
- Franchisor financing
- Not offered
- Item 10
- POS system
- POS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: POS
Item 20 · call current owners
Franchisee Contacts
2,053 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
H&R Block · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a H&R Block franchise?
The total investment to open a H&R Block franchise ranges from $34K – $159K, with an initial franchise fee of $3K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do H&R Block franchise owners earn?
H&R Block does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is H&R Block's franchise failure rate?
Based on SBA 7(a) loan data, H&R Block has a charge-off rate of 5.6% across 54 loans, meaning 5.6% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many H&R Block franchise locations are there?
As of their most recent FDD filing, H&R Block has 8,688 total units in the United States, including 2,339 franchised units and 6,701 company-owned units. 1 new units were opened in the latest reporting year.
Is H&R Block a good franchise to buy?
FranchiseVerdict rates H&R Block as a F-grade franchise with a risk score of 95 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.