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CALL 6: Carmel couple receives tax bill instead of tax refund

Posted at 2:46 PM, Oct 15, 2016

CARMEL, Ind. – Imagine receiving a letter from the IRS demanding hundreds of dollars, although your tax return stated you were due for a refund.

That’s exactly what happened to a couple in Carmel who filed their taxes through H&R Block earlier this year.

Michael Horrigan, who had been using H&R Block’s tax services for more than two decades, said he was given copies of his returns stating he would receive $4,789.

The refund would cover the more than $1,600 the couple spent on tax preparation, including $40 spent on H&R Block's Peace of Mind Program.

Their paperwork shows a cost of $299, but that fee was waived because they signed up for the Peace of Mind program. 

"Peace of Mind to me is something if there was an error something done incorrectly, the company would take care of it and make it right so we would have peace of mind,” he said.

The federal refund never arrived and instead, the couple received a collection notice in June asking for $483 from the IRS. The State of Indiana also wanted an additional $695.

"It's supposed to be a return not a bill,” said Horrigan. “It wasn't what was expected.”

The pair had already paid the state $483, but said things didn’t add up.

Kate, Horrigan’s wife, reached out to another tax preparer who told her the return she had was not the one filed with the IRS.

Horrigan and Kate hoped the Peace of Mind Program would fix the confusion but in August, H&R Block’s claim department reviewed their claim and denied it. Instead they were offered free tax preparation for 2017.

The company responded to Call 6 Investigates’ request to review the case.

“We take this matter seriously and worked directly with the client to resolve this matter.

As a good faith effort, we have offered to refund the tax preparation fees as a customer service gesture."

After several months of communication, the couple received a refund on Wednesday for $1683 which included the $40 for the Peace of Mind program.

The Peace of Mind Program is meant to cover customers who face an audit due to a tax preparation error.

In this case, the Horrigans were not the focus of an audit.