2026 FDD Issued Sep 30, 2026 Minnesota Commerce (CARDS)
H&R Block Franchise Cost (2026)
A H&R Block franchise costs an estimated $35,780 – $161,050 to open, according to Item 7 of the 2026 Franchise Disclosure Document (FDD). That total includes the $2,500 initial franchise fee (Item 5) and covers this format: Single New Office. Item 6 lists royalty: 20% – 60% of Revenue, subject to the conditions below. This record has unresolved source-review issues and was published provisionally before independent verification was complete.
Read the source-review hold before using these figures.
- Total investment
- $35.8K – $161KItem 7 source and qualifications
- Franchise fee
- $2,500Item 5 source and terms
- Royalty
- 20% – 60% of RevenueItem 6 conditions and fee bases apply
What stands out about H&R Block
The company is buying back its franchises. Item 20 shows the franchisor reacquiring franchised offices in large numbers each year while almost none open, leaving 1,819 franchised offices at the end of fiscal 2026 in a system run mostly by company offices. The projected-openings table plans new company offices and no new franchised ones.
The royalty takes the largest share of the first dollars. Item 6 charges a much higher rate on the first block of revenue each calendar year than on revenue above it, cuts both rates for payment within days of each reporting period, and offers a lower incentive rate on growth over an owner's recent average. There is no separate marketing fund; Item 11 says the franchisor pays for and controls advertising.
Startup cost is low because the office is small. Item 7 puts the range at $35,780 – $161,050 for a single new office with a handful of workstations, and notes that buying several offices or an established territory costs more. An affiliate of the franchisor lends to franchisees for acquisitions and for expenses before each tax season.
There is no right to renew and no Item 19. The agreement ends after 10 full tax seasons, and the franchisor may, at its option, offer a successor franchise. The FDD makes no financial performance representation, so it gives no sales or profit figures for any office.
What are the initial franchise fees and financial requirements for H&R Block?
Item 5 lists an initial franchise fee of $2,500 for H&R Block. Check the cited Item 5 for payment timing, discounts and format-specific terms.
Item 5 (PDF page 16): $2,500, paid in a lump sum when you sign the Franchise License Agreement (FLA), fully earned and not refundable.
Source: H&R Block 2026 FDD, Item 5, PDF p. 16.
This record lists no minimum net worth or liquid-capital requirement for H&R Block, because no sourced figure has been recorded. Ask the franchisor for its current financial qualifications in writing.
How much does it cost to open a H&R Block franchise? (Item 7)
Source: H&R Block 2026 FDD, Item 7, PDF p. 18.
Item 7 of H&R Block’s 2026 Franchise Disclosure Document estimates the total cost to open one single new office at $35,780 – $161,050. This total includes the initial franchise fee.
| Expense Category | Low ($) | High ($) |
|---|---|---|
| Initial Franchise Fee | $2,500 | $2,500 |
| Real property (3 months) | $1,400 | $30,000 |
| Leasehold improvements; construction costs | $0 | $50,000 |
| Signage | $1,200 | $6,500 |
| Furniture and decor items | $15,000 | $30,000 |
| Equipment | $11,700 | $14,300 |
| Opening | $500 | $1,000 |
| Initial training expenses | $1,500 | $3,000 |
| Start-up supplies | $500 | $500 |
| Insurance | $1,000 | $1,650 |
| Zoning expenses | $0 | $500 |
| Utility deposits | $50 | $300 |
| Architect design | $0 | $4,500 |
| Professional fees | $0 | $2,500 |
| Additional funds | $430 | $12,000 |
| Applicable business licenses, if required | $0 | $1,800 |
| Total | $35,780 | $161,050 |
Item 7 (PDF pages 18-20) prints $35,780 to $161,050 for one new office; its 16 lines add to that total. The estimate assumes 800 to 1,200 square feet with 5 to 6 workstations and parking for at least 5 cars; insurance figures are annual. Buying several offices or an established territory costs more, and no company-owned office or territory was sold in the prior fiscal year. The franchisor's affiliate Franchise Partner, Inc. offers term and short-term loans (Item 10).
What ongoing royalties and fees does H&R Block charge? (Item 6)
Source: H&R Block 2026 FDD, Item 6, PDF p. 16.
Item 6 of H&R Block’s 2026 FDD lists the charges below. Recurring charges and charges triggered by a transfer, renewal or other event have different conditions. Read each fee’s basis and notes before comparing rates.
How to read an Item 6 fee table.
| Fee Type | Amount / Rate | Payment Frequency | Notes & Source |
|---|---|---|---|
| Royalty | 20% – 60% of Revenue | Every period | 60% of the first $5,000 of revenue each calendar year (50% if paid within 4 days and nothing else is overdue), then 40% (30% if paid promptly). Revenue above your 2-year average earns a 20% incentive rate if paid promptly, after 2 full tax seasons. Paid within 30 days of each reporting period. (Item 6, PDF p. 16) |
| Business Services Royalty (product-specific rate) | 10% – 15% of Revenue | When it applies | 15% of business services revenue (10% if paid within 4 days), part of the Item 6 royalty row. (Item 6, PDF p. 17) |
| Second Look Review Royalty (product-specific rate) | 20% of Revenue | When it applies | 20% of fees for Second Look reviews, part of the Item 6 royalty row. (Item 6, PDF p. 17) |
| POM Extended Service Plan and POM Protection Program | Varies | When it applies | Participation is required. Each Peace of Mind plan sold carries a 20% product-specific royalty and a premium charge (no more than $15 last tax season, set yearly), and approved claims carry a $50 deductible. (Item 6, PDF p. 17) |
| Transfer | $2,500 | When it applies | $2,500 before approval of a transfer; the franchisor may waive it. (Item 6, PDF p. 17) |
| Audit | Varies | When it applies | Cost of the audit if it shows revenue understated by at least 2%. (Item 6, PDF p. 17) |
| Additional Training | $35 per year | When it applies | Currently $35 a year per participant for the franchisor's tax preparation training; some training may be mandatory. (Item 6, PDF p. 17) |
| Term Loan Interest Rate | Varies | When it applies | The loan interest rate may rise by 4% if you default under a Term Loan Credit and Security Agreement with the franchisor's affiliate. (Item 6, PDF p. 17) |
Explore annual fees and payback assumptions
This fee schedule cannot be reduced to the calculator’s simple sales-based formula. Enter your own assumptions and check them against the Item 6 terms.
H&R Block startup investment and modeled fees over 10 years
A source check placed this record on review hold. Automatic fee estimates are withheld until the outstanding issues are resolved. Item 6 charges a tiered royalty on revenue: 60% of the first $5,000 each calendar year (50% if paid within 4 days of the reporting period) and 40% above that (30% if paid promptly), with an incentive rate of 20% on revenue above your average for the 2 previous years once you have completed 2 full tax seasons. Business services, Second Look reviews and Peace of Mind plans carry their own rates. Because of the tiers, this record does not produce an annual fee estimate or payback preset. See the fee amounts and definitions in Item 6 above. Open the calculator with your own assumptions.
Item 20: H&R Block franchised outlet history
Source: H&R Block 2026 FDD, Item 20, PDF p. 50.
Item 20 Table 3 reports 1,819 franchised outlets at the end of 2026. The company-owned table reports a further 6,745 outlets.
| Year | Franchised at Start | Opened | Reported Exits | At End | Franchise Exit Rate (%) |
|---|---|---|---|---|---|
| 2024 | 2,339 | 0 | 204 | 2,135 | — |
| 2025 | 2,135 | 1 | 149 | 1,987 | — |
| 2026 | 1,988 | 29 | 198 | 1,819 | — |
Calculated outlet totals, net growth and exit rates are withheld because this record has not cleared the current Item 20 source checks. The table retains the outlet counts printed in Item 20. Read the unresolved source issues.
Reported exits include terminations, non-renewals, franchisor reacquisitions and other cessations. A reacquired outlet may continue operating. How we calculate the exit rate. How to read the Item 20 outlet tables.
24 units changed owners in 2026.
Item 20 uses fiscal years ending June 30. Table 3 (PDF page 50) reports 169, 118 and 167 franchised offices reacquired by the franchisor in fiscal 2024-2026, against 0, 1 and 29 openings. Fiscal 2026 starts at 1,988, one more than the prior year-end, and Table 1 (PDF page 43) prints a fiscal 2026 year-end of 1,816 rather than 1,819. Table 4 shows company-owned offices rising from 6,582 to 6,745. Table 5 projects no new franchised offices and 100 new company-owned offices in fiscal 2027.
How much do H&R Block franchise owners make? (Item 19)
Source: H&R Block 2026 FDD, Item 19, PDF p. 42.
H&R Block’s 2026 FDD has no Item 19 financial performance representation, so it gives no official sales, profit or owner-pay figures. Treat any earnings claim you hear from a salesperson with caution, and ask current owners (their contacts are listed in Item 20).
Item 19 (PDF page 42) states that the franchisor does not make any representations about the financial performance of company-owned or franchised outlets.
Payback calculator (enter your own assumptions) Check any inputs against this record’s Item 7 startup costs and Item 6 fee rules.
How long is the H&R Block franchise agreement term?
Source: H&R Block 2026 FDD, Item 17, PDF p. 40.
The standard H&R Block franchise agreement runs 10 years.
Item 17 (PDF page 40): the FLA ends on June 1 after the tenth full tax season following its effective date. There is no automatic renewal; the franchisor may, at its option, offer a successor franchise under a new FLA.
How long does it take to open a H&R Block franchise? (Item 11)
Source: H&R Block 2026 FDD, Item 11, PDF p. 28.
Item 11 of the 2026 FDD states the time from signing the FLA to opening: 30 to 120 days.
Franchises with a similar investment range
These published records are selected by proximity to H&R Block’s $35,780 low-end Item 7 investment, starting with Business Services. Formats, fees and source qualifications differ; the figures are not interchangeable budgets:
- Chester's $27.5K – $307K Source review pending Provisional publication Restaurants & Food
- Proforma $7,030 – $27.7K Source review pending Provisional publication Business Services
- Paramount Tax & Accounting $71.2K – $166K Business Services
- Payroll Vault $77K – $114K Business Services
- The Seals $101K – $147K Business Services
- Spherion $133K – $301K Business Services
Compare other business services franchises
Sources
H&R Block Tax Services LLC Franchise Disclosure Document, issued September 30, 2026, as filed with the Minnesota Commerce (CARDS). Read the source FDD PDF. How to get this FDD yourself.
- Item 5: cited PDF p. 16
- Item 6: cited PDF p. 16
- Item 7: cited PDF p. 18
- Item 19: cited PDF p. 42
- Item 20: cited PDF p. 50
- Agreement term (Item 17): cited PDF p. 40
Page references for H&R Block use the PDF viewer's digital page count, not printed page headers. Some viewers download the document instead of opening the referenced page.
If the state document viewer does not open, use Minnesota Commerce's public filing instructions to look up the filing by franchisor name and document date.
Document & verification changelog
- November 3, 2026: Source review hold recorded. Unresolved corrections are listed in this source section.
- November 3, 2026: Initial cost profile published from the 2026 Franchise Disclosure Document (issued September 30, 2026).
- November 3, 2026: Rechecked against the September 30, 2026 Minnesota FDD: Items 1, 5, 6, 7, 11, 17, 19 and 20. The royalty now records the full tiered schedule (60% and 40%, with prompt-payment and incentive rates) in a model note, and Item 6 adds the Peace of Mind charges and the term-loan interest increase. Removed fields the schema does not use, added the opening time and rewrote the analysis. The Item 20 conflicts between Tables 1, 3 and 4 remain and are disclosed.
- November 2, 2026: Provisional publication approved per owner directive: Owner directed on November 2, 2026 that every remaining batch 6 brand go live, including brands whose FDDs print conflicting figures. Each record was rechecked against its FDD on November 3, 2026; the unresolved source conflicts remain disclosed and the record is not marked verified.