LIBERTY TAX SERVICE Franchise Complaints

5,730 thoughts on “LIBERTY TAX SERVICE Franchise Complaints”

• John Barilla,

  You need to read the report carefully there was only a 4.5% increase in store volume which resulted in 79,000 new returns. However, when you take this number and divide it by 4400 offices that means each office only had an increase of 18 new returns per office.

  Next factor in all of the new Wal-Mart locations that were added this past year, this is not a good sign at all.

  Finally with Liberty being the only tax service that was offiering a loan product, Liberty’s numbers should have been through the roof.

  It was not the brick and mortar offices that brought in the new business it was the online software which had an increase of 26.5% increase in new returns. Of course most of these returns were free, and how much reverse royalties do you expect from these free returns?

• More and more taxpayers are using “do-it-yourself” tax software to do their tax returns, so that market is shrinking, and client tax accounting has become a low-margin commodity service.

  The IRS, H&R Block and even Liberty Tax all reported an increase in do-it-yourself clients. The online software is going to shrink the number of brick and mortar offices, much like how the internet is shrinking the postal service.

• As NCHillbilly pointed out in the aggregate its a positive for the company but how does it benefit the individual franchisees. We will get a better idea of that when they release the financials.

  The question on this site has always been; If you are an individual looking to open a tax practice is it better to go as an independent or with a tax franchise. When you look at the three largest tax retailers you see that combined the only have 23% of the market share. Then you look at Liberty and see that after 16 years they only have a 2% market share. A Liberty territory is based on 30,000 individuals which at best works out to 10,000 tax returns. If and its a big if as a Liberty franchisee you can capture 2% of that market it comes out to 200 returns. For this you will have to pay a $40,000 franchisee fees and a royalty of $5000.00 minimum or 14% the first year and an advertising fee of 5%. This does not factor in all the other cost the franchisee pays or address the quality of the company and their business model.

• In other words, Liberty sucks.

  If the individual stores added 18 returns, that would be a huge increase for some of them. Likely 10% or more. The AD’s would tell them they are on the right track.

  And it’s frightening to think Hewitt can point out that Liberty is the fastest growing franchise and they only have 2% of the market. It’s going to be a big selling point for him, for sure.

  This company is for suckers, glad I got out when I did. Stay away, there is no money to be made with Liberty, just endless headaches, lost time and your own money.

• Bill,

  How many aliases do you plan on using today?

• Bill,
  You might want to rethink the individuals per territory. To increase the number of territories available, they reduced it to 25,000 for new territories. Older territories stayed at 30,000 when sold from zee to zee. If corporate had taken over an existing territory, it was changed to 25,000.

• I left the company after the 2008 tax season. For this site to be effective we need current franchisees and franchisees that just left the system to speak up.. I know there out there because Liberty lost 10% of their franchises last year or around 500 stores. The only way to hurt this company is through it’s pocket book and we can do that by fairly presenting the facts!!

  I know Liberty tries to intimidate franchisees that they will come after you if you say anything negative about them. But the fact is the company doesn’t have the tools to do it. After I left the system I was amazed to find out I could still sign on to Zeenet. It took them almost a year to block me access and even thought I would sign on no one ever sent me anything about it. The company is not well run and we all know that.. Take comfort in the fact that everyone that post here is really “Bill” just posting another alias.

• I left the Liberty system 2 tax seasons ago. My return count did increase for the 4 years I was involved with Liberty, but not because of the brand, it was because of me. I received tons of referrals who wanted to specifically work with me. I also brought about 50 of my own clients when I started and was still unable to turn a profit. I barely broke even my last year and that was after moving to a very small office with inexpensive rent and working most of the hours myself.

  My final year, I had revenues of about $70k, which was quickly soaked up by royalties, payroll and other expenses. In the last 2 tax seasons on my own, my revenues were much smaller, about $15k, but only about $1k in expenses. You do that math. Oh, and I have a regular full-time job, this is just a second income.

• I had also forgotten to include my own marketing expenses above and beyond what Liberty mad me pay in royalties. I averaged about $5000 per year per store which included Door Hangers (useless marketing suggestion), direct mailing which was somewhat effective, giveaways such as pens that were far more useful than foam crowns and any other way to get people in the door. I even put a magnetic sign on my car.

  With all these expenses adding up, it is impossible to make a profit with this franchise. Keep away from these crooks!

• The purpose of this site is to provide to potential franchisees as much factual information as possible. Now that Liberty has gone public most of the information that is provided here can be based on information found in the financial statements.

  In 2013 Liberty stores in the US did 1,890,000 returns per financial statements and confirmed by John Barilles post of 5/2/14. According to the financials Liberty had 4,262 US stores operating in 2013. Based on these figures the average number of returns prepared by store is 443 returns. We need to discount this figure by 67 returns or 15% to account for the free returns (encouraged by Liberty) and clients that don’t pay. This leaves us with 376 returns multiplied by 180.00 per return ( average net fee per 2013 financial statements) for a total revenue of 67,762.

  On 4/17/2014 Texastee stated the average cost of operating a store was $63,300. In his post he provided a detailed explanation of how he came to this figure.

  Based on these figures your net profit would be 4,462.00. You could clear this much money by doing 50 returns at home just by buying a tax preparation software and talking to your friends and family.

  admin: Currently under FCC guidelines for franchisors they can present financial data using various methods. They do not have to provided on an average. i.e. first year stores etc. I was wondering if there could be section at the top of each page just based on hard facts. i.e. Liberty had 4262 stores that averaged 422 returns, the average revenue was 66,762 and average net fee was 180.00.

• Seriously guys, I don’t know the exact count but at least 400-500 (maybe more) of those storesare Walmart Kiosks. These only cost about 10k-15k to operate at most and they normally do 50-100 returns.

  I have said this several times now. These 500+ stores will significantly bring all “per store” averages way down.

  It is really comical to see you guys post on here the same incorrect garbage.

• Funny thing is Bill, you double count the free returns. Average return fee if you factor in free returns and unpaid returns was $180 a year ago. The average paid return is more like $240 or something. Also, I am sure the average fee went up from last year.

• Could a current franchisees provide information on how the average net fee is calculated. It’s been a while since I was involved with Liberty but I’m sure that actual free returns were not included in the calculation of average net fees. Unpaid returns would be.

  John: I don’t see how I’m double counting free returns. Liberty includes all returns prepared and in that figure is free returns. So please explain how I double counted free returns?

  Ed: If you don’t know the exact count of Wal-Mart stores then how can we count on the other figures your listing. I’m presenting the information as it’s presented in the financial statements that the company provides. 1,890,000 returns and 4,262 stores = 443 returns. I would welcome the company providing more detailed information. I would like to see them present average returns prepared by age of
  store? By type of location etc.

• Wanna bet that Ed is just another alias for John Barilla??? He accuses US of all being the same person posting under various names………but he’s the stupid ass that is actually doing it.

• Ed,
  A couple of thoughts on your post
  Let’s make a couple of assumptions to start
  -most Walmart stores are franchise owned (most likely accurate)
  -average tax prep is about 180 (we will be generous and call it 200)

  Now, you said each walmart does 50-100 returns
  Let’s use 75 and split the difference
  Tax season is 104 days long
  That is .72 tax returns a day
  12 hours open per the “system” at ohhhh let’s say $8.50 per hour x 6 days=$102 per day payroll (this is bottom of the bucket. To have an experienced tax pro would obviously be more)
  Sunday 8 hours=$68
  So average daily payroll is $97
  Average daily revenue is $144
  Pay john about 20%=$29 leaves $115 minus payroll leaves $18 minus payroll tax leaves $7.25
  So those are the easy expenses….@7.25 a day x 104 days= $754 for the tax season.
  Now buy a computer $400. Buy a printer $200. Buy paper $100. Buy cables and cords $100. Buy a phone $100. Phone service 4 months @$150=$600. Rent @$700×4 months=$2800. Advertising $200…..I’ll stop here…..
  $4300 in expenses against that $754 in the hole $3500
  Now let’s assume you put an experienced preparer in there. Payroll went up accordingly and 20 of their clients from the storefront last year came to the walmart to see them. (Nets a $4000 loss of revenue from your storefront)
  Did you pay them overtime for the hours in Walmart?
  Now these are from your figures of 50-100 returns
  Let’s say absolute best case and it’s the 100 return walmart
  Add $5000 of revenue and all other expenses are bottom of the bucket low
  You made $1500 minus johns $1000 leaves you $500
  But did you lose any of the storefront returns to the walmart netting less in the storefront?
  Did you pay more than $8.50? Did you have overtime?
  I know this doesn’t apply to john barrilla and testa as each of their stores did a gazillion returns by 1/15 and had 10s of thousands in revenue each day but for the rest…..the numbers look great

• ^^^Greg:

  YES!!!!! :) [A-W-E-S-O-M-E]

• Thank you Greg. I am saving your post for my research documents. I did research using credible resources. The profit margin on this business is 12 cents on the dollar. In a major city, the profit margin is about 13 cents on the dollar. (That is without a franchise fee.)

• Greg,

  What about the money you will have to pay to Wal-Mart to set up shop each year. Ace Check Cashing was $1500 per location per season.

• ^^^Uphillbattle:

  They certainly don’t tell you anything remotely close to that when you sign up. In fact, I was “forced” to sign rather quickly. I was told I would not be allowed to sign up in time for that year’s tax season unless I signed “right away”. Their marketing dept. is slick and quite disgusting, actually.

  The franchise fees are just the tip of the iceberg. Their slick campaign to get you, lock you in, and then spit you out has to be one of the most horrendous experiences on the planet.

  You have NO ONE to turn to for help. NO ONE should be subjected to the horrors of working FOR THEM. They say it’s YOUR company, working for YOURSELF, that’s BULLS—.

  I can’t even begin to tell you the nightmares I faced working for them and then trying to disengage myself away from them. They are SHARKS. That company needs to go down, down, down and the CEO locked away forever.

• We are STILL searching for a way to resolve the matter. Currently a “manager” avoids our call. This is AFTER the same behavior from the manager who actually did our taxes in 2012. First she disappeared overnight. Several months later we found a listing entitled “corporate offices”. After several calls and promises to “look into the case” and asking for our case number, now we have to deal with the same unprofessional behavior, as the woman assigned to our case is “on the run” from us. As she refuses to take our call and is never in the office anymore.

  No satisfaction from liberty taxes, just thousands of dollars missing, and disabled elders wondering… “this month should I buy food or pay rent, we were so depending upon those refunds.

  Liberty taxes, your time is coming, as I know for a fact that the California tax franchise board is aware of what you are doing and they are watching you.

• While I understand the anger and frustration that “disabled people” feels and their desire to vent this is not the forum. All these types of post do is deflect the attention from the real issue “Why Liberty Tax is not a good investment.

  Now that tax season is over Liberty will turn their sights to selling franchises. It should be our goal on this site to provide potential franchisees with as much relevant information as possible.

  For potential franchisees, there are two human elements Liberty relies on to sell its franchises. The first is our own fear of failing and the other is greed. i.e.work 4 months of the year, etc.

  If you are a CPA, EA or a seasoned tax professional then you already have the tools necessary to have a successful tax practice. To own a Liberty Tax Franchise you will have to pay a $40,000 franchise fee, pay a royalty of 14% of revenue or a minimum of 8,000 the first year and 11,000 n subsequent years and a 5% advertising fee based on revenue. On top of that you will have all the same cost of owning your own practice plus the added pleasure of being told what hours to keep, how much staff you should have and how much you should spend on your marketing budget. Of course you have to use Liberty vendors who kick-back money to the company.

  By signing the franchise agreement you commit yourself to a 5 year contract where you pay a $40,000 franchise fee, a minimum of 52,000 in royalties and a 5% advertising fee. That’s $18,400 a year before the advertising fee. If you don’t perform or more importantly if you do perform but don’t think your getting fair value to bad, Liberty dictates who you can sell to and they own the customer list. The company holds all the cards.

  Buyer Beware!!!

• Bill, you lying as usual. Liberty does not force you to use their vendors. 100% lie. as usual from you.

• VIRGINIA BEACH, VA–(Marketwired – May 15, 2014) – U.S. Veterans Magazine (USVM) has accredited Liberty Tax Service, a subsidiary of JTH Holding, Inc. (NASDAQ: TAX), for their employment efforts for veterans. The results of USVM’s 2014 survey were recently released after the magazine polled hundreds of Fortune 1000 companies for the evaluations. Once again, the magazine recognized Liberty Tax on the “Best of the Best” of the Nation’s Top Veteran-friendly Companies list.

  “What an honor to be recognized again by USVM as ‘Best of the Best.’ We have many franchise owners that are veterans. The Liberty franchise model offers them the chance to transition back into civilian life using the very skills they learned while serving their country. It really is a great fit,” stated Martha O’Gorman, Chief Marketing Officer for Liberty Tax.

  Liberty Tax is committed to helping transitioning service members, veterans, and families. Liberty Tax continually supports the military and veterans by serving as a National Premier Partner for Cell Phones for Soldiers, a national sponsor of Wounded Wear (woundedwear.org), and through its Chairman sponsorship with VetFran, which created Opportunity Enduring Freedom, assisting veterans in their job search.
  1-8022

• I stand corrected you don’t have to use Liberty’s vendors but most new franchisees aren’t aware of the fact they can choose their own vendors or that Liberty gets a kick back from the vendors they “suggest”. After all as a new franchisee who just invested $40,000.00 your hoping that there is a common goal between the franchisor and the franchisee for both to succeed not to exploit them for a few more dollars.

  The above press release is another great example of how the corporation spins the facts or greases someone’s palm . I looked through the list of fortune 1000 companies and JTH holding/Liberty tax was no where to be found. So who they polled and why they would suggest Liberty is one of the best of best is any one’s guess. JTH Holding corporation only employees 950 to 1100 people so just based on scale the company is limited by what it can do.

• Bill,

  Seems like you are the one that “spins the facts”…. This is great company and continues to grow and well on pace to be larger than HR Block by 2020.

• Bill,
  All Liberty had to do to get on the list is fill out a survey. Once that was done, four other groups looked at the survey for other minority groups, then they publish it.
  The question I would have is how many hours did Liberty put into the survey before it was submitted?

• Bill:

  I agree with you 100%. Please do not apologize to Barilla Gorilla. You are absolutely right. I have never seen a company so money hungry that they gorge you with THEIR contacts and connections that charge 3,000% more than getting it on your own.

  To the general public reading thorugh this forum:

  If you have read through enough pages here, you will see that there are MANY, MANY unhappy franchisees, both current and ex. Thanks goodness I am an EX franchisee. I HATED every single minute of the 5 exceptionally L-O-N-G years of that ridiculous contract, which, by the way, has become waaaaay more stringent in the years since I left. It is like working for a Nazi regime. They TELL you it’s your business. That’s about as far from the truth as it really is. There is NO room for your own stamp on this business, unless, of course, you back away, don’t sign, and start your own.

  When posters like Greg, NCHillbilly and Bill report ACTUAL numbers, figures, fomulas, then you can see what an incredibly poor business model this company is and how little money you make. And how much you lose. “Successful” or not, you LOSE lots of money, no matter how you cut it. And it goes to line THEIR pockets. And listening to them give you lectures, ‘notices to cure’, and all the things you are doing wrong. THEY have the perfect formula………BULL CRAP.

  They are sneaky, coniving SHARKS. The CEO, JTH should be sent to jail for racketeering, fraud, RICO and a million other reasons. HANG HIM!!! It happened to Bernie Madoff. Now it’s Hewitt’s turn. He has frauded the general public for over 40 years. He hires the sleasiest lawyers to get him out of all situations. STOP him already!! :(

• I never head of US Veteran’s magazine. I guess its circulation must be in the hundreds.That, of course, means that Hewitt bought off someone else for an endorsement. As you can see, Barf-rilla is an obvious corporate plant that still refuses to concede to logic. He is always right and the rest of the world is wrong.

  My prediction is that the stock will take a nosedive pretty soon. Right now Hewitt and his thieves are able to pull the wool over the eyes of some investors. Still not a large cap stock or anywhere near it. Doesn’t trade in the millions of shares per day thus making it easily manipulated.

  I also wonder if the shareholders are aware that Hewitt is wasting their money on lawyers to continue his personal vendetta against former franchisees. This also looks like a RICO case, but the government hasn’t prosecuted too many of these and political contributions easily derail these investigations.

  So we have it that these bunch of crooks are going to continue to dupe the public, minorities and franchisees until they are stopped cold. I hope the day of reckoning is approaching soon. You can’t make money on this concept nor can you succeed with the so called “help” of the franchiser, as is the case with Liberty Tax.

  This is a bad deal all around. Know it and act upon it.

• When I left one territory, I was advised that those prior clients are NOT mine and I can’t write them or talk to them!

• The whole franchise concept is a money maker for the franchisor. That’s why the stock market loves it. The company based on their own criteria parcels up territories which they then sell to franchisees. Through the franchise documents they essentially maintain the rights to the territory. If the franchise doesn’t produce they can take back the territory without compensation and then resell the territory. If you are a successful franchisee and want to get out they control who you can sell to. During the whole process the franchisee is the one who pays all the operating cost. Years ago it was a partnership. i.e. McDonalds they bought the real estate and then sold you a McDonalds franchise. Here was an agreement that benefited both the franchisor and the franchisee. The corporation collected rent on the property and royalties on the franchise. Both the franchisor and the franchisee had skin in the game. Now the franchise process has become a way for a person with a concept to make money without incurring much risk and this is all because the laws about franchising are all skewed in favor of the franchisor.

  In my own personal opinion franchising has become an exercise in exploitation. I can’t think of any franchise concept in the last twenty years that has meet 80% of what they exclaim.

  Liberty however is one of the worst. It has no named brand, it is seasonal, does not have a clear plan of development. i.e. the company started in VA but will sell franchisees to anyone and anywhere who has the franchisee. This philosophy, which is a generous term, has led them to not having a significant presents anywhere. That’s why after 20 years they are 3rd in market share in a three man race and the one in 2nd place is handicapped by bankruptcy.

• John Barilla:

  Yes they do, you are required to buy your computers from Liberty’s vendor…..

• ^^^Did you also know that Liberty’s vendor loads each computer with spyware???!

  How is that not a violation of human rights? I have a boatload of stories I can tell about human rights violations when it comes to Liberty Tax. They are the WORST offenders ever. They suck royally.

• Liberty sells you territories that haven’t a prayer of making any money then wring $8K minimum out of you even the very first year. It should be illegal. These people should rot in jail for what they have done. Den of thieves.

  John Barilla is a company goon – no real franchisee, successful or otherwise, would state you only work hard 4 weeks a year to be successful. This is straight out of the company sales pitch.

  Sure, there are a few franchisees that make $$ but most – the majority – do not. And that is not what a franchise is supposed to be. The system only works in certain demographics. Period.

  LibTax has NO investment or risk – its all on the franchisee. LibTax continually sells and churns lousy territories with no hope of success.

  And I can’t believe that they are stll spewing the falsehood that they wll be bigger than HR by 2020. There really have no shame.

  I got out before this past season started and it has been such a stress relief. The company is getting worse, not better. My time with LibTax was a nighmare.
  Thank God I’m out with my health, my sanity and at least some of my $$. I’m luckier than a lot of others.

  Any prospective franchisee needs to run fast.

  Den of thieves. Stay away from these crooks.

• Biggest by 2020? Originally they told me biggest by 2010. Ooops!

• Before John starts spouting more garbage, we were only required to buy the processing computer from the vendor. The rest you could buy from anywhere. However since the system is networked, they could get to any of the computers when they were on, and I wonder if they would install the software when Libtax updated.
  New zee’s would not be told that they could buy the workstations from anybody.

• This website has been adding more lies and lies as time goes. I bought my computers on my own my first year and that was 2009. You do not have to use any of their vendors if you don’t want to. Stop making stuff up! SanFran, what are you talking about? Half the time you are in la-la land.

  WARNING: Please post under a single screenname. We will change your name to reflect your primary posting name. Thanks. ADMIN

• The territories I purchased were already “ruined” by other zees and they were not “undeveloped” territories as they love to spout. They are destroyed and anyone loving LTS already drives to that store and will not even grace your door, unless they are there to spy on the new zee.

  I am pretty sure, everyone was going to have to eventually update their computer systems from Zones not just a processor. The last year I was with LTS I spoke with the computer department and they were so glad I had Zone computers but it took them days to fix a small problem because they were working on 9 or 10 offices all at the same time…..

  They told me it would be a requirement eventually.

  All the Zone computers are built in with Spy ware and they can be turned on from home office at any time, unless you physically unplug them which I did frequently especially during the off season because it was so annoying to come in and who knows how long the computer had been on and running.

• ^^^Testicle Pirate:

  Just wait till the real truth comes out. The only people lying on this forum are you and John Barf villa.

  I speak the truth. I have never had such an incredibly difficult and depressing experience. And that comes from being a ‘successful’ franchizee! The absolute worst 5 years of my life. The whole company has become MORE strict and stringent since I left, if that’s even possible. They are huge assholes making tons of $$ off of all of us. They discovered the formula after years of perfecting it. I know for a fact there are MANY ex-franchisees that are not posting on this forum that have lost the shirts off their back………

  you think I’m in la la land? Hahahahahahahahahaha…….I’M OUT OF IT NOW!!!!!!!!!!!!! I have PROOF there was spyware installed. The truth will come out eventually. And Hewitt better be shown the padded jail cell at that point.

• I don’t remember if it was mandatory that the processor was from zones or not. We were told you could buy the PCs from anywhere but they could only support them if you bought from zones. Since your business relies upon it, you bought from zones. Overpriced pieces of crap.

  What a bad experience. Had the first relaxing Jan – April I’ve had in years. Funny… my other business which is full time, year round and I actually make money from, was/is less stressful than the “only work hard 4 weeks per year”, “you can run this business absentee”, “just follow the system” franchise.

  People – don’t walk – RUN. Don’t get involved it is a noose around your neck that you are never free of as long as you are a franchisee. The AD breathes down your neck and tells you to spend all your money to make money. Doesn’t work. Period.

  You are either in a good location or not. But they won’t tell you that – they place the blame squarely on the head of the franchisee. They truly try and make you feel like a looser. Then you start looking around and reach out and find out that none of the offices are making any money in a good 50 mile radius. Hanging on, yes. Making a living – no. According to corporate we are all loosers. What a rip off. That is NOT what a franchise is supposed to be.

  If they sell you a lousy territory they should have to buy it back. You can’t make a lousy territory work. Of course, that would mean a lot of corporate owned territores.
  Anyone ever hear of Anne Fuller? There is a reason she had to resort to those tactics.. It was the only way to make $$.

• Now that the dust has settled, I want to ask you franchisees how the past tax season went. Did you have more or fewer clients, have heavier or lighter traffic, make any money? Has the lack of RALs destroyed or benefited your business? (I have a theory that it could help by encouraging “regular” taxpayers, who equated RALs with check-cashing joints and used-car dealers, to come back.)

• SaraEA: I now work for an accounting firm in Southern NJ We handle a broad range of clientele from low income to upper income individuals and we had a very busy tax season. The economy is improving specifically in the construction industry which is a big employer in our area.

• Liberty is already at it. They have the “Tax Business Owner” listing on CareerBuilder.

• Bill,

  Glad you found a job at the accounting firm. You don’t seem cut out to own a business. There is nothing wrong with that. Some people order, some people take orders.

  WARNING: Please post under a single screenname. We will change your name to reflect your primary posting name. Thanks. ADMIN

• Testa,
  Know what you mean
  After all, you take your orders from John don’t you? I mean you follow his rules, oops I mean “system”
  You are paid an 80% commission that you have to cover all expenses out of right?
  Maybe independent is a more accurate description of “business owner” wouldn’t you agree? You do answer to liberty tax right? What happens if you don’t follow liberty’s rules? Are you “fired” ? Notice to cure?
  What if it was testapiras tax service? Would you really be the boss then?

• Tesaiira: As a CPA with plenty of tax experience I looked to a franchise to give me a strategic boost because of branding and advertising. I originally looked for an HR Block franchise but do to their success these franchises do not come on the market very often. So I inquired about a Liberty tax franchise. It actually took me a couple of years before I decided to attend a seminar in Virginia Beach. There where things I liked about the company, JH had already had success with Jackson Hewitt, there was the theme of being involved with the community etc. There was also my own fear that by myself I would have less of a chance of being successful vs. going with a franchise.

  I believed the hype. However, the reality as it turned out was “Liberty Tax” has no brand. At last count with 4000 offices ( 1/3 the size of HR Block who has almost 20% of market share) Liberty is 3rd behind HRB and Jackson Hewitt among the three biggest retail tax prep. with a 2% market share. I use to think that the reason Liberty has no national or regional advertising/marketing plan was it went against John Hewitt and the company’s philosophy but the reality is they can’t afford it. They use most of their cash flow by providing operating loans to their struggling franchisees.

  The fact of the matter is I provided Liberty with a skilled individual who lived up to his commitment. Despite the fact that the original territory I bought was in Somers Point NJ, but because the company would not approve any sites I ended up transferring my territory to Pleasantville/ NJ. After doing less then 100 returns, mostly all free as required by the company. I moved the office to Northfield NJ where I stayed for 3 more season. In each year I increased my average net fees, was growing the the business annually between 20 and 25% and had a retention ratio over 60%. The bad advice I received started with selling me a territory that you wouldn’t approve a store in, requiring that I staff according to a budget of 600 returns, That I open in early January and hold a tax class and purchase 10 books, that I stay open from 9 to 9 through tax season despite the fact that the first peak ends by Feb. 14 and doesn’t pick up again to the last week of March. the list can go on but the most important point is that Liberty charges a ‘minimum royalty fee”. If they believe in their system so much they should charge 14% royalty on what is actually produced. If they did I would probably still be a franchisee, they would still be collecting royalties and we would be building the brand together. But instead I turned the territory back over to Liberty in 2009 for the outstanding royalties of $23,000.00. They have yet to sell that territory and I have become a strong advocate speaking out about the company.

• Take heed to Greg and Bill’s points. I am also a Tax professional and was looking for a “leg up” on starting a business on my own. I had a good client base already, but I was looking to work for myself, not another CPA. I thought that the franchise route was the way to go since I lacked the confidence to go by myself. This was at the early stages of when Liberty has no track record, there were only about 300 franchisee’s, and RAL’s were the heart of the business. Boy, in retrospect, I should have stayed away from these crooks. Not only did they charge me royalties on my pre existing clients, they provided no support for the royalties I paid them. I had a big fight with Screwitt and got a partial refund (in the form of a credit against royalties owed) for the “error”. You can never get a dollar out of these knuckleheads and I should have been smart enough to leave then. I stayed because I attributed this to growing pains of Liberty.

  The computer they recommended that I buy was inferior, as I have said previously. They could not support it or the software. It broke down always at critical times. Never any advertising in my territory even though one year I contributed $8000 in royalties.

  As it turned out, I could have gotten more setup help from Taxwise, which was the tax software at the time, in setting up the system than I ever got from Liberty. This was just for the cost of the software and support, which was considerably less than the territory cost with the minimum royalty.

  So, what has been said here is accurate. There are some people within Liberty that like to post to try to positively spin for the company. The overwhelming majority of the posts are from those of us that have been robbed by this system and are here to bear witness and warn others of this predatory franchise.

• testaipira maybe you should read Liberty’s policy on PC’s under tech support.

  Special Notes:
  ◦Windows XP will not be supported after April 30, 2014
  ◦All existing Processing & Satellite Transmitter Computers and Mobile Tax Preparation Computers must be a ZeePC and have been purchased through the approved computer vendor.
  ◦ALL NEW Tax Preparation Computers must be a ZeePC purchased through an approved computer vendor if the franchise agreement was signed or renewed on or after 6/1/2012.

• Thanks NCHillBilly! That is what I was told 18 mos ago via home office and when you would have the “compliance” webinar’s.

  I suspect that Testapirate and John Guerilla are not working zees but the big CEO zees. Because their lack of knowledge of LTS is absolutely remarkable. They just show up to take the money, but don’t do the actual tax returns and take care of all the b.s. this company dishes out! Nor take care of people in a warm caring way because they are “clue birds” of what is really going on. They do however go to all the parties and John’s beach house because they are so impressed with themselves.

• Wow. Haven’t stopped by in a while. It looks like you’ve gone from 3 people posting under 10 or so name to maybe a half dozen people – quite a crowd.

  Any franchise system is set up to the franchisor makes money. The good ones are set up so that the franchisee also makes money. Liberty is one of the good ones, and plenty have made a living, plenty have made a million. But this is a business, and if you don’t have the ability to follow the system you will probably not do well. If you don’t know how to take care of your customers, you probably won’t do well. If your first inclination is to complain when something doesn’t go well, you probably won’t do well. This is a great website for the website owner and those on this website who get paid to post (and yes, readers, some but not all of the posters here are being paid – this website is also a business and makes $$ from advertisers).

  It used to be fun to read these posts and post when Trish was warning about the impending DOJ lawsuit taking down Liberty – but when the dust settled what you had was Trish and Annie exposed for what they were – which is why Trish no longer uses her prior name here. Still in Louisville, Trish? You were a great marketer – just got lead astray by Annie and you did wrong by your customers.

  I hope you all find peace – all 6 of you.

• Lost in the past it seems. Two people don’t set the pace for thousands of franchisees. That said, I think it’s still true many new comers will lose money. The cost to market the stores has increased for the store owners since they pay for everything.

  SaraEa it was a great tax season! Experience means repeat customers and I believe lots had late season pickup. Bad preparers are driving people back to knowledgeable ones. We got a noticeable referral and comebacks because of the
  IRS letters people are receiving after going other places.