Economy and Recovery Top Taxpayers' Minds

KANSAS CITY, MO, Apr 06 (MARKET WIRE) --
Approximately 4,000 taxpayers called or emailed their toughest tax
questions to the H&R Block Tax Talk Hotline -- seeking clarification on
everything from filing status, to unemployment benefits and investment
losses.

Taxpayers from across the United States, as well as some in Iraq,
Australia, and Hong Kong, sought advice from H&R Block tax experts during
the 24-hour hotline on March 25.

"The questions from taxpayers certainly echoed the tough financial times
we are in," said Jennifer Love, vice president of communications for H&R
Block. "Families are struggling and saw the free hotline as a valuable
lifeline to some tax-related stress relief."

Questions ranged from traditional tax topics on unemployment, energy
efficiency and life changes, to the quirky, like questions from a state
lottery winner or a new lawyer wondering if the bar exam qualifies as a
tax deduction. (It doesn't. The cost of the exam and any review courses,
are nondeductible personal expenses. Likewise for the CPA and other
professional certifying exams.)

In general, taxpayers questions centered on four areas:

Unemployment

With unemployment hovering around 10 percent, questions around
unemployment income and severance pay were top-of-mind. All unemployment
income -- minus the first $2,400 received -- is taxable. Severance pay
also is taxable income. Taxes may be owed come April 15 if taxpayers
didn't withhold taxes at their normal tax rate on severance pay or
unemployment income.

Energy
With up to $1,500 at stake, many taxpayers
asked which upgrades qualify for the energy tax credits. Whether it's a
new furnace, door or energy-efficient windows, taxpayers must ensure the
upgrade meets the qualifications. While many Energy Star-certified
products qualify, homeowners should check the manufacturer's tax credit
certification statement to confirm.

Life changes
Newlyweds who tied the knot in 2009 wondered if they should
file separately or married filing jointly. Divorcing spouses inquired
about their filing status if they weren't divorced the entire year. H&R
Block tax professionals advised that their filing status should match
their marital status on Dec. 31, 2009.

With economic woes fostering more multi-generational living arrangements,
taxpayers called the Tax Talk Hotline for guidance about the filing
status of Gen Y children returning home and parents caring for their
parents. Typically, a child cannot be claimed as a dependent if they are
19 years or older and not a full-time student. If they are a student,
then they can be claimed as a dependent until age 24 -- assuming other
qualifications are met, such as living with the parent for more than half
the year.

In most cases, parents may claim their parents as dependents if they meet
certain criteria such as providing more than half of their support
including food and shelter.

Investments
Other taxpayers needed help
claiming capital gains and losses, drops in their 401(k)s or guidance on
the new IRA rules. A maximum of $3,000 in capital losses a year may be
claimed to offset other types of income. Also, losses can be carried over
year-to-year and utilized up to the $3,000 maximum each year. Drops in
401(k) retirement accounts cannot be claimed as a loss.

New IRA rules for 2009 allowed taxpayers to convert a traditional IRA to
a Roth IRA without penalty. By making this change, taxpayers will be able
to withdraw from the account tax-free when they're of retirement age.

"The hotline was consistent for 24 hours," Love said. "With such a
complex tax code and the economy seeing some signs of recovery, taxpayers
realized the importance of getting it right."

Taxpayers who missed the 24-hour Tax Talk Line can still get their
questions answered for free from H&R Block's Get It Right community site.
H&R Block has responded to more than 100,000 questions through the online
community since the beginning of the year.

About H&R Block
H&R Block Inc. (NYSE: HRB) is the world's preeminent tax
services provider, having prepared more than 500 million tax returns
since 1955. In fiscal 2009, H&R Block had annual revenues of $4.1 billion
and prepared more than 24 million tax returns worldwide, utilizing more
than 100,000 highly trained tax professionals. The Company provides tax
return preparation services in person, online through H&R Block Online,
through its H&R Block At Home(TM) software and through other channels.
The Company is also one of the leading providers of business services
through RSM McGladrey. For more information visit our Online Press Center
at www.hrblock.com/presscenter.

For Further Information:
Gene King, (816) 854-4287, Email Contact
NYSE: HRB

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