Jackson Hewitt Tax Service
Bottom line
- Total investment $71K – $105K including a $25K franchise fee, 3.0% ongoing royalty.
- Average unit revenue of $118K/year (median $87K).
- Rated MODERATE with a risk score of 64/100. SBA loan default rate of 0.0% across 217 loans (below the industry average).
- System contracting at -12.7% CAGR over 3 years. Investigate whether closures are franchisor-driven (consolidation) or franchisee-driven (economics).
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Jackson Hewitt Tax Service unit return on the cash you put in?
Unlevered ROIC · per unit
17%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Jackson Hewitt Tax Service units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$153K
on $765K purchase
Total debt
$612K
SBA $0.4M + senior + seller note
Overview
About
Franchisees operate Jackson Hewitt tax preparation and filing locations, primarily serving middle to lower-income customers during tax season (January-April peak). Day-to-day operations include conducting client tax interviews, preparing returns, managing e-filing, promoting refund advance products, and handling customer service—operations heavily dependent on seasonal demand with significant off-season downtime.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 24 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 phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Jackson Hewitt presents HIGH RISK due to contracting franchise system, absent financial disclosure, extensive litigation history suggesting operational/compliance issues, and potentially inadequate unit economics for franchisees.
Score breakdown · what drove the 64 / 100 rating
- 01MINORUnit count declining 3.6% YoY (5,197 to ~5,011 units) indicates shrinking franchise system and potential market saturation or franchisee dissatisfaction
- 02MINORNo net income disclosure (Item 19) prevents financial viability assessment; average revenue of $117,660 may be insufficient after 3-15% royalties, operating costs, and seasonal tax service volatility
- 03HIGHLitigation portfolio reveals recurring business model issues: state investigations into grant programs, class actions over customer fees, franchisee disputes over incentives, and antitrust no-poach provisions suggest systemic franchisor-franchisee tension
- 04MEDRoyalty structure up to 15% is punitive on disclosed average revenue of $117,660 (up to $17,649 annually), creating thin margins before expenses
- 05HIGHTax preparation is highly seasonal (peak Dec-Apr) creating cash flow and staffing challenges; no going concern status suggests franchisor stability questions
- 06MEDHigh initial investment ($71,050-$105,000) combined with declining unit count and undisclosed profitability creates unfavorable risk-reward ratio
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
47 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Jackson Hewitt Tax Service · FDD (2025) PDF