Microsoft and H&R Block Forge Alliance in Consumer Tax Category

REDMOND, Wash., March 23, 2000 — Microsoft Corp. today announced a three-year agreement with H & R Block to provide exclusive Web and desktop-based tax preparation products for its customers who use the MSN TM MoneyCentral TM online personal finance service and Microsoft® Money. The companies also plan to collaborate on integration capabilities between Microsoft financial products and Block’s digital tax preparation products. As part of the new alliance, Microsoft announced it will cease further development of its Microsoft TaxSaver TM tax preparation software.

“With more than 45 years of expertise, H & R Block is the brand more people trust with their tax returns than any other company worldwide,”
said Richard Bray, general manager of the Financial Products Group at Microsoft.
“With their solid base in tax preparation services and our strong set of personal finance tools on MSN MoneyCentral and in Microsoft Money, this is a great combination for our customers.”

Mark Ernst, president and chief operating officer of H & R Block, said,
“Microsoft has a tremendous base of customers as well as unsurpassed technology expertise. This alliance with Microsoft is key to expanding our position as the worldwide leader in all forms of tax preparation.”

Under the terms of the agreement, Microsoft will provide TaxCut software downloads and links to H & R Block’s online tax preparation program, and the companies will collaborate on significant technology enhancements to H & R Block’s online tax products. The enhancements will include utilization of Microsoft’s personal identification and security software. Additional enhancements and collaborations will be announced prior to tax season 2000.

Bray reaffirmed that consumers who have acquired Microsoft TaxSaver products for tax year 1999 will be fully supported throughout the remainder of this tax season. Beginning in tax year 2000, Microsoft and H & R Block will integrate TaxSaver and Block’s award-winning TaxCut software so that TaxSaver customers will be able to import their files from this tax season into TaxCut next year.

This agreement is a significant expansion of an original one-year agreement in which H & R Block’s online tax services were made available to customers of MSN MoneyCentral.

About H & R Block

Founded in 1955, H & R Block is a diversified company with subsidiaries providing a wide range of financial products and services. H & R Block Tax Services Inc. served 18.9 million taxpayers in more than 10,000 offices located primarily in the United States, Canada, Australia and the United Kingdom in 1999. H & R Block Financial Advisors and Olde Discount Corp. provide consumers with financial planning and investment products. Option One Mortgage Corp. and H & R Block Mortgage Co. offer a full range of home mortgage products. Through RSM McGladrey Inc. and HRB Business Services Inc., the company has built a national accounting, tax and consulting firm. Block Financial Corp. offers consumer financial products and services.

Quarterly results and other information regarding H & R Block are available on the company’s Web site at http://www.hrblock.com/ .

About Microsoft

Founded in 1975, Microsoft (Nasdaq
“MSFT”
) is the worldwide leader in software for personal and business computing. The company offers a wide range of products and services designed to empower people through great software – any time, any place and on any device.

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Microsoft, MSN, MoneyCentral and Microsoft TaxSaver are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

For more information, press only:

Alison Wertheim, Edelman Public Relations for Microsoft, (415) 433-5381, alison_wertheim@edelman.com

Joanna Fuller, Edelman Public Relations for Microsoft, (206) 621-3595, joannaf@ms.edelman.com

Linda McDougall, H & R Block, (816) 932-7542, lmcdougall@hrblock.com

Aaron Horvath, H & R Block, (816) 932-4890, ahorvath@hrblock.com

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Web site at http://www.microsoft.com/presspass/ on Microsoft’s corporate information pages.

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