- The Washington Times - Monday, February 7, 2005

Customers of H&R; Block can cash their tax refund checks issued by the tax preparation service at 7-Eleven stores under a new marketing agreement between the companies.

Washington and Baltimore are among the first markets where the service is being offered.

“We think this appeals to anyone who wants their cash right away,” said Margaret Chabris, spokeswoman for 7-Eleven.

H&R; Block has offered customers “refund anticipation loans” for years under a program in which the tax preparer issues them checks for the amount of their expected refunds within a day or two of completing their returns.

For the first time this year, the customers can cash the checks valued up to $7,500 at 7-Eleven “Vcom,” or virtual commerce, kiosks inside many of the convenience stores.

Customers are charged fees on the “refund anticipation loans” that run from $29.95 for checks of less than $500 to $109.95 on checks greater than $3,700.

The 7-Eleven Vcom kiosks collect another 1.8 percent of the value of the checks.

H&R; Block prepared more than 16 million tax returns last year. An average tax refund this year is $2,500.

The Vcom kiosks are located in 1,058 7-Eleven stores, all of them within “a mile or two” of a roughly equal number of H&R; Block stores, Miss Chabris said.

Although any H&R; Block customer getting a refund can use the service, it appears to be targeted primarily at low- or moderate-income people.

“It appeals to customers that do not have a checking account and are unable to either deposit the check into a checking account or cash it at their own bank without a fee,” said Greg McBride, senior financial analyst for Bankrate.com, a consumer-finance Web site.

“If you’re in a situation where you have certain obligations that have to be paid now … getting the money now instead of waiting could be very appealing.”

People who cash checks at banks where they do not have accounts typically are charged fees of around 2.5 percent of the value of the checks.

“Nearly 22.2 million households in America don’t have checking accounts,” said Tim Gokey, president of U.S. Tax for H&R; Block. “When it comes to cashing a check, they need to have choices to select a service that is trustworthy, convenient and offers a fair and competitive price.”

The 7-Eleven stores installed the first Vcom kiosks in 1998 for transactions such as ATM withdrawals, money transfers and the purchase of money orders. This year, the software includes special H&R; Block buttons on the touch screens to guide customers through the tax check-cashing process.

John Hewitt, chief executive officer of H&R; Block competitor Liberty Tax, said, “I think it’s a good customer service philosophy.”

The H&R; Block tax refund option is available at 7-Eleven Vcom kiosks in Arizona, California, Colorado, Florida, Oregon, eastern Pennsylvania, Dallas-Fort Worth, Austin, the Salt Lake City area, Richmond and southeastern Virginia, and Washington state.

Internal Revenue Service officials said they would not comment on the program. However, they concede their refunds take significantly longer than the checks offered by H&R; Block.

“If a taxpayer files their return electronically and has their refund deposited directly into their bank account, they can receive their tax refund in 10 days or less,” said Nancy Mathis, IRS spokeswoman. “A paper return takes a month or more.”

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