Business
Did you pay H&R Block for tax help? You may be getting a refund
As Californians do their taxes for 2023, an estimated 70% could qualify for free help online to prepare and file their federal returns. But in the past, only a small percentage of them have taken advantage of these services.
State and local officials have long blamed the lack of participation on two leading tax-preparation companies, Intuit (maker of TurboTax) and H&R Block, and have sued both of them for misleading the public about the free offerings. On Monday, the Los Angeles city attorney’s office announced that H&R Block had agreed to settle the city’s lawsuit and repay customers as much as $1.6 million.
The announcement follows the $141-million settlement that 51 state attorneys general struck with Intuit in 2022. TurboTax customers were reimbursed last year; now it’s H&R Block customers’ turn.
“With tax filing season starting today, this settlement is a reminder that millions of taxpayers are eligible to file their federal tax returns free of charge,” City Atty. Hydee Feldstein Soto said in a statement. “I am pleased to be able to return $1.6 million to people who shouldn’t have paid for a free service.”
H&R Block’s chief legal officer, Dara Redler, said in a statement that the tax preparing company was also “pleased to be able to resolve this matter.”
Here’s what you need to know about the H&R Block settlement, who’ll be eligible for a payments, when the payments will be made and what alternatives are available to the free services offered by H&R Block and Intuit.
What was the lawsuit about?
As with the Intuit lawsuit, the dispute with H&R Block centered on the company offering two free tax-filing products. One was a free, entry-level version of H&R Block’s paid service, the other was H&R Block’s version of the IRS Free File service.
The key difference is that Free File is available to anyone who earns less than the income limit set every year by the IRS, regardless of how they earned their money, while H&R Block’s entry-level service is mainly for wage earners with very simple returns. People who tried to use H&R Block’s free service with more complicated returns — for example, those with income from gig work or other forms of subcontracting — were told they needed to upgrade to the company’s paid service, even if they qualified to use Free File, the city’s lawsuit alleged.
H&R Block denied any wrongdoing, but agreed to the settlement “to avoid the time, expense, and uncertainty of litigation,” the stipulated judgment states.
Who is covered by the settlement?
The settlement applies to Californians who paid H&R Block to prepare and file their returns online from May 6, 2015, to Oct. 31, 2020, despite being qualified for free help under the IRS Free File program.
There’s a caveat, though — the settlement applies just to people who signed up for H&R Block’s free entry-level service and were steered to its paid product. Anyone who used H&R Block’s version of Free File in a previous year is not entitled to a payment.
Free File is available to only people whose adjusted gross income — that is, income minus certain deductions, including retirement savings contributions and student loan interest payments — is under the cap set by the IRS, which rises annually with inflation. For 2020, the limit was $72,000.
According to the California attorney general’s office, 70% of the U.S. residents who file tax returns were eligible to use Free File for their 2020 taxes, but less than 3% did.
How much will the settlement pay?
The amount isn’t specified in the settlement. Instead, it will depend on how many of the eligible recipients respond to the settlement offer, and how many times they used H&R Block’s paid service. The more people who respond, the smaller the amount will be.
According to the city attorney’s office, there are 76,212 Californians eligible for restitution. If they all respond to the offer, they will receive at least $18.89 per use of H&R Block’s paid service.
What do you have to do to obtain a payment?
Just reply to an email. Under the settlement, H&R Block is supposed to identify which of its customers are eligible for a payment. The company will then turn over the customers’ names and addresses (mail and email) to the settlement administrator, who will send them an email asking how they would like to receive their share of the fund.
Here’s another caveat: You won’t be able to collect your payment in cash or by check. Instead, you’ll have to receive the money electronically through a service such as Venmo, PayPal or Zelle.
When will the payments be made?
Under the settlement, which was signed Friday, H&R Block has three weeks to name an administrator, whose costs will be covered by the company, not the settlement fund. The administrator will then have 44 days to email the people who are eligible for payment.
Once the administrator receives your reply, it will have 30 days to make your payment. So if you respond quickly to the administrator’s email, you should get it by mid-April.
What alternatives are there for filing your tax return for free?
Both H&R Block and Intuit stopped participating in the IRS Free File program. But both continue to offer free versions of their paid software to people with simple returns.
Eight online tax-preparation companies participate in Free File, providing free help to taxpayers whose adjusted gross income was $79,000 or less in 2023.
This year, the IRS is offering its own free, in-house tax preparation and filing service called Direct File for people with simple returns, competing with the free services from Intuit and H&R Block. It was launched Monday on an invitation-only basis, though, and won’t be widely available until later in the tax-filing season.
The AARP Foundation Tax-Aide and the IRS-sponsored Volunteer Income Tax Assistance program can connect you to a volunteer tax preparer who will file your tax return for you or help you do it yourself, at no charge to you. These services provide tax preparation or guidance only to low- and moderate-income taxpayers who meet the income limits, or who have disabilities or limited English proficiency.
Several of the participants in Free File also offer free help preparing and filing California returns. And the state Franchise Tax Board offers qualified taxpayers the ability to file their returns for free online through a service called CalFile.
Business
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Business
Civil case against Alec Baldwin, ‘Rust’ movie producers advances toward a trial
Nearly two years after actor Alec Baldwin was cleared of criminal charges in the “Rust” movie shooting death, a long simmering civil negligence case is inching toward a trial this fall.
On Friday, a Los Angeles Superior Court judge denied a summary judgment motion requested by the film producers Rust Movie Productions LLC, as well as actor-producer Baldwin and his firm El Dorado Pictures to dismiss the case.
During a hearing, Superior Court Judge Maurice Leiter set an Oct. 12 trial date.
The negligence suit was brought more than four years ago by Serge Svetnoy, who served as the chief lighting technician on the problem-plagued western film. Svetnoy was close friends with cinematographer Halyna Hutchins and held her in his arms as she lay dying on the floor of the New Mexico movie set. Baldwin’s firearm had discharged, launching a .45 caliber bullet, which struck and killed her.
The Bonanza Creek Ranch in Santa Fe, N.M. in 2021.
(Jae C. Hong / Associated Press)
Svetnoy was the first crew member of the ill-fated western to bring a lawsuit against the producers, alleging they were negligent in Hutchins’ October 2021 death. He maintains he has suffered trauma in the years since. In addition to negligence, his lawsuit also accuses the producers of intentional infliction of emotional distress.
Prosecutors dropped criminal charges against Baldwin, who has long maintained he was not responsible for Hutchins’ death.
“We are pleased with the Court’s decision denying the motions for summary judgment filed by Rust Movie Productions and Mr. Baldwin,” lawyers Gary Dordick and John Upton, who represent Svetnoy, said in a statement following the hearing. “He looks forward to finally having his day in court on this long-pending matter.”
The judge denied the defendants’ request to dismiss the negligence, emotional distress and punitive damages claims. One count directed at Baldwin, alleging assault, was dropped.
Svetnoy has said the bullet whizzed past his head and “narrowly missed him,” according to the gaffer’s suit.
Attorneys representing Baldwin and the producers were not immediately available for comment.
Svetnoy and Hutchins had been friends for more than five years and worked together on nine film productions. Both were immigrants from Ukraine, and they spent holidays together with their families.
On Oct. 21, 2021, he was helping prepare for an afternoon of filming in a wooden church on Bonanza Creek Ranch. Hutchins was conversing with Baldwin to set up a camera angle that Hutchins wanted to depict: a close-up image of the barrel of Baldwin’s revolver.
The day had been chaotic because Hutchins’ union camera crew had walked off the set to protest the lack of nearby housing and previous alleged safety violations with the firearms on the set.
Instead of postponing filming to resolve the labor dispute, producers pushed forward, crew members alleged.
New Mexico prosecutors prevailed in a criminal case against the armorer, Hannah Gutierrez, in March 2024. She served more than a year in a state women’s prison for her involuntary manslaughter conviction before being released last year.
Baldwin faced a similar charge, but the case against him unraveled spectacularly.
On the second day of his July 2024 trial, his criminal defense attorneys — Luke Nikas and Alex Spiro — presented evidence that prosecutors and sheriff’s deputies withheld evidence that may have helped his defense . The judge was furious, setting Baldwin free.
Variety first reported on Friday’s court action.
Business
California’s gas prices push Uber and Lyft drivers off the road
The highest gas prices in the country are making it tougher for some gig drivers to make a living.
Gas prices have shot up amid the war in the Middle East. On average, California gas prices are the most expensive in the United States, according to data from the American Automobile Assn. The average price of regular gas in California is almost $6. The national average is a little above $4.
While Uber and Lyft drivers have concocted clever ways to cut gas consumption, they say that without some relief they will be forced to leave the ride-hailing business.
John Mejia was already struggling to make money as a part-time Lyft driver when soaring gas prices made his side hustle even harder.
“Unfortunately, it’s the economics of paying less to drivers and gas prices,” he said. “It actually is pulling people out of the business.”
Guests at The Westin St. Francis hotel get into an Uber.
(Jess Lynn Goss / For The Times)
Gig work offers drivers the freedom to work for themselves and more flexibility, but being independent contractors also means they must shoulder unexpected costs.
Ride-sharing companies say they’re trying to help, but drivers say the gas relief comes with caveats. For now, drivers say they’re being pickier about what rides they accept, cutting hours and are looking at other ways to make money.
Mejia, who started driving for Lyft more than a decade ago, said in his early days, he would sometimes make $400 in three hours. Now it takes 12 hours to rake in $200.
The San Francisco Bay Area consultant is an active member of the California Gig Workers Union, so he knows he isn’t alone. California has more than 800,000 gig rideshare drivers, according to the group, which is affiliated with the Service Employees International Union.
On social media sites such as Reddit and Facebook, gig workers have posted about how the higher gas prices are eating into their earnings. Among the tricks they are suggesting: reducing the number of times the ignition is turned on or off, avoiding traffic, working in specific neighborhoods and at times with high demand and switching to electric vehicles.
Gig drivers usually have only seconds to decide whether to accept a ride on the app, but they have become more strategic about which rides and deliveries they accept.
That means they are more likely to sit back in their cars and wait for higher fares for quick pick-up and drop-off.
“I highly recommend the ‘decline and recline’ strategy, rejecting unprofitable rides until a better one appears,” wrote Sergio Avedian, a driver, in the popular blog the Rideshare Guy.
Pedestrians cross the street in front of a Lyft and Uber driver on Wednesday. High gas prices have made it hard for gig drivers to make a living, cutting into their profits.
(Jess Lynn Goss / For The Times)
Uber, Lyft and other companies have unveiled several ways to help drivers save on gas.
Uber said drivers can get up to 15% cash back through May 26 with the Uber Pro card, a business debit Mastercard for drivers and couriers. Based on a worker’s tier, they can get up to $1 off per gallon of gas through Upside — an app that offers cash rewards — and up to 21 cents off per gallon of gas with Shell Fuel Rewards. The company also offers incentives for drivers who want to switch to electric vehicles.
“We know the price of gas is top of mind for many rideshare and delivery drivers across the country right now,” Uber said in a blog post about its gas savings efforts.
Lyft also said it’s expanding gas relief through May 26 because the company knows that the extra cost “hits hardest for drivers who depend on driving for their income.”
The company is offering more cash back, depending on the driver’s tier, for drivers who use a Lyft Direct business debit card to pay for gas at eligible gas stations. They can get an additional 14 cents per gallon off through Upside.
Drivers say the fine print on the offers dictates which card they use and where they fill up gas, making it difficult for them to save money.
“If I do the math, it’s ridiculous,” Mejia said. “They’re offering us nothing.”
Uber declined to comment, but pointed to its blog post about the gas relief efforts. Lyft also referenced the blog post and said “the gas savings were structured through rewards to maximize stackable opportunities.”
Guests at The Westin St. Francis hotel get into an Uber.
(Jess Lynn Goss / For The Times)
Gig workers have struggled with rising gas prices in the past.
In 2022, Lyft and Uber temporarily added a surcharge to their fares amid record-high gas prices following Russia’s invasion of Ukraine. This year, Uber is adding a fuel charge to its fares in Australia for roughly two months to offset the high cost of gas for drivers. Lyft said it hasn’t added a fuel charge in the U.S. or elsewhere.
Margarita Penalosa, who drives full time for Uber and Lyft in Los Angeles, started as a rideshare driver in 2017. Back then, gas was cheaper. She would easily hit her goal of making $300 in eight hours. Now she’s making just $250 after working as much as 14 hours.
Gas prices, she said, used to be less than $3 per gallon. Now some gas stations are charging more than $8 per gallon.
“Take out the gas. Take out the mileage from my car and maintenance. How much [do] I really make? Probably I get $11 for an hour,” she said.
Jonathan Tipton Meyers wants to spend fewer hours as a rideshare driver.
He already juggles multiple gigs even while driving for Uber and Lyft in Los Angeles. He’s a mobile notary and loan signing agent, a writer and performer.
Driving is “a very challenging, full-time job,” he said. “It’s very taxing and, of course, wages were just continually decreasing.”
John Mejia, a longtime Lyft and Uber driver, poses for a portrait before attending a meeting about unionizing gig drivers.
(Jess Lynn Goss / For The Times)
Even if oil continues to flow through the Strait of Hormuz, which Iran reopened Friday, it could take a while for gas prices to come down to earth, said Mark Zandi, the chief economist at Moody’s Analytics.
“There’s an old adage that prices rise like a rocket and fall like a feather,” he said. “I think that’ll apply.”
In the meantime, it will be survival of the fittest drivers. If enough of them decide to leave the apps, the ride-hailing companies could be forced to raise fares further to attract some back.
“Those who approach rideshare driving strategically, tracking expenses, choosing trips carefully, and optimizing efficiency are far more likely to weather periods of high gas prices,” wrote Avedian in the Rideshare Guy blog. “For everyone else, a spike at the pump can quickly turn rideshare driving from a side hustle into a money-losing venture.”
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