By DAVID WILSON

Taxes are certain, as the saying goes. Profits from investing in tax-preparation and payment companies are another matter.

Just two of six publicly traded U.S. companies in those businesses have risen since last year’s income-tax deadline: H & R; Block Inc., the largest tax preparer, and H.D. Vest Inc., a rival that also provides financial-planning services.

H & R; Block had to overcome business-related setbacks last May and June in recording a 12 percent gain for the period. And while H.D. Vest’s stock more than tripled, most of the advance followed a $127.5 million takeover bid from Wells Fargo & Co. last month.

The four that have fallen include Intuit Inc., a personal-finance software maker whose products include TurboTax; Cendant Corp., a franchising company whose units include Jackson Hewitt (H & R; Block’s largest rival); and Gilman & Ciocia Inc., a smaller competitor that owns e1040.com, a tax-preparation Web site.

Official Payments Corp., a unit of Comerica Inc. since January, rounds out the group. The company provides electronic-payment systems that allow people to pay federal, state and local taxes, as well as fines, by credit card.

Relative strength

On the other hand, Intuit and Cendant both have lost less since last year’s deadline than the benchmark Standard & Poor’s 500 Index, which includes the two companies along with H & R; Block. The shares have fallen 13 percent and 8.3 percent, respectively, while the S & P; 500 has retreated 19 percent.

These percentages reflect price changes since April 17, last year’s deadline for most Americans to file income-tax returns. The traditional deadline of April 15 occurred on a weekend, just as it does this year.

Gilman & Ciocia has also performed well by comparison with its benchmark index, the Nasdaq Composite. The company’s shares have declined 25 percent, only about half as much as the index.

The same can’t be said for Official Payments, which does business with the Internal Revenue Service, 18 state governments and the District of Columbia, and more than 700 local governments. Its stock has fallen 74 percent, exceeding the Nasdaq’s 51 percent decline. Last week’s close of $5.25 a share was about one-third of the $15 price at which the company went public in November 1999.

Official Payments stands out from the group in two other ways: It’s the only one that has a parent company, and it’s the only one that was consistently unprofitable during the past year.

Seasonal pattern

Comerica, Michigan’s largest bank, acquired a 55 percent stake in the Stamford, Conn.-based company as part of its $1.3 billion purchase of Imperial Bancorp. Official Payments had losses in each quarter of 2000, and recorded a full-year loss of $30 million on revenue of $26.1 million.

The quarter-to-quarter performance is noteworthy because these six companies do the bulk of their business during “tax season,” running from January through April.

At H.R. Block, for instance, the U.S. tax business traditionally was profitable only during the company’s fiscal fourth quarter, which ends in April. The Kansas City, Mo.-based company broke that pattern in the current fiscal year, with a third-quarter pretax profit of $7.4 million.

Numbers such as this helped the company rebound from last year’s back-to-back disappointments. In May, the stock sank after the company said costs related to electronic commerce and a legal settlement would hurt results. It fell again in June after saying fiscal 2000 earnings were lower than analysts’ estimates.

Tax-preparation services and software, including Kiplinger’s Tax Cut, account for about half the company’s sales. Almost all the rest comes from mortgage, securities and business-consulting units acquired during the past four years.

“There do seem to be cross-selling opportunities there, and darned if they aren’t getting some,” said Ronald Sloan, a San Francisco-based money manager with AIM Funds Management Inc. “It’s been a pleasant outcome.”

Sloan’s Mid Cap Equity Fund, with $500 million in assets, owns H.R. Block shares. His firm held about 1.9 percent of the company’s stock at the end of last year. Other investors include Warren Buffett’s Berkshire Hathaway Inc., which had an 8.4 percent stake last December.

Intuit, based in Mountain View, Calif., also counts on tax software and services for the bulk of its sales. The company expects 15 million people to use TurboTax this year in preparing their returns, spokeswoman Julie Miller said.

This year, Intuit has stumbled as sales of its QuickBooks small-business software and advertising on its Web sites, such as Quicken.com, tailed off. The stock has fallen 25 percent, and last week’s low of $22.63 was its lowest price in about 20 months.

Cendant, by contrast, is among the year’s 10 best performers in the S & P; 500. Shares of the New York-based company have climbed 51 percent as it expands through takeovers, including this month’s $690 million purchase of Fairfield Communities Inc., an operator of timeshare resorts.

Busy elsewhere

Jackson Hewitt is a relatively small piece of Cendant’s business, which also includes franchises for Days Inn and Ramada hotels, Avis rental cars and Coldwell Banker real estate offices.

Likewise, Gilman & Ciocia gets only about one-fifth of its annual revenue from tax preparation, provided through the White Plains, N.Y.-based company’s offices as well as e1040.com. Financial-planning services, including securities brokerage, insurance and mortgages, account for the rest.

The company’s stock, which retreated to a three-and-a-half-year low of $2.50 in December, has gained 33 percent this year. Even so, its $30.5 million market value is the lowest of the six companies.

H.D. Vest, whose business is similar to Gilman & Ciocia’s, had a comparable market value before last month. Then Wells Fargo offered to buy the Irving, Texas-based company for $21.03 a share, almost 80 percent above its all-time high of $11.75 in May 1998.

Assuming the bid succeeds, any investor who owned H.D. Vest shares beforehand will come out ahead. In other words, gains are as inevitable as taxes for them but only for them.

David Wilson is a columnist for Bloomberg News.