H&R Block Inc.’s biggest competitor, Jackson Hewitt Tax Service Inc., is warning of some potentially serious financial issues.
The Parsippany, N.J., company (NYSE: JTX) said in a filing with the Securities and Exchange Commission that pre-packaged bankruptcy is an option if it can’t restructure the credit lines that help sustain the business between tax seasons.
Jackson Hewitt is the second-largest tax preparer in the United States, behind Kansas City-based H&R Block (NYSE: HRB).
Currently, Jackson Hewitt’s credit agreement contains covenants requiring it to maintain a fully financed refund anticipation loan (RAL)...