H&R Block Inc. is stopping service under its EXPRESSTAX brand, which helped people who filed their taxes early and wanted refunds quickly.
The news comes a little over two weeks after the nation's biggest tax preparer announced that it won't offer refund anticipation loans next tax season because it's getting more new clients and the appeal of the high-cost loans is shrinking.
EXPRESSTAX was traditionally an early season business, an H&R Block spokesman said. Typically, the customers who sought refund anticipation loans did so in late January and February. The spokesman could not confirm whether EXPRESSTAX handled a large percentage of the loans.
H&R Block said Thursday that it will record a pretax charge of about 2 or 3 cents per share in its fiscal second quarter related to discontinuing EXPRESSTAX service.
CEO Bill Cobb said in a statement that the company is getting rid of the brand because "it was no longer a growth driver and therefore not a good fit for our company."
Since Cobb took over in April, Block has announced plans to sell its RSM McGladrey consulting unit and other moves to consolidate the business. The spokesman said shuttering EXPRESSTAX is part of that strategy to focus on its core Block-branded stores and digital tax prep business.
There are currently 269 EXPRESSTAX franchise offices. H&R Block says it will ask many of the franchisees to join its main brand.
EXPRESSTAX prepared almost 100,000 tax returns and generated $3 million in royalty fees for H&R Block in fiscal 2011. H&R Block bought EXPRESSTAX in 2006.
H&R Block said it increased its new client base by almost 19 percent during this year's tax season, with its client retention rate rising by nearly 4 percent.
The company lured first-time customers by offering free simple tax form preparation and reviews of prior tax returns and beefing up its online tax prep offerings.
Block shares rose 1 cent to $13.52 in afternoon trading.