H&R Block Clears Dispute With Gay Couples

H&R Block Inc. is offering to reimburse part of the cost some gay couples and others in civil unions encountered earlier this year when the company's online tax filing system refused to submit their returns.

The Kansas City-based company is offering couples who can show documentation that they started with the online product but had to complete the process at one of H&R Block's retail offices either a $100 coupon toward having their tax returns prepared next year or a free copy of H&R Block's TaxCut software.

"We don't discriminate," said company spokeswoman Denise Sposato. "We want to make sure if anyone tried to use TaxCut online they had a recourse here."

The American Civil Liberties Union raised the issue in March on behalf of a Hartford, Conn., couple, Jason Smith and Settimio Pisu, who tried to file their joint state tax return as a civil union in January. The online network told them that the company's software didn't support tax returns from civil unions in Connecticut and recommended they complete their returns at an H&R Block office.

ACLU attorneys said that was discriminatory because it was more time-consuming and the couple had to pay an extra $155 to file their taxes that way.

Sposato said the problem involved difficulties in meshing rules in the various states that allow civil unions with the federal tax system, which doesn't recognize civil unions. She said the company has developed a technical workaround to avoid the problem in the future.

"When the ACLU brought this to our attention, we agreed with them," she said, adding that the company doesn't know how many couples may be eligible for the refund.

Besides Connecticut, Vermont, California, New Jersey, New Hampshire, Maine, Washington and Oregon have laws allowing either civil unions or domestic partnerships. Hawaii extends some rights to same-sex couples and cohabitating heterosexual couples.

ACLU officials welcomed the company's action.

"We're pleased that H&R Block has decided to do right by gay couples throughout the country," Rebecca Shore, an attorney with the ACLU Lesbian Gay Bisexual Transgender Project, said in a written statement. "Saying you've been civilly united will never be the same as saying you're married, but at least gay couples will no longer face the prospect of paying more to prepare their taxes."