EMPLOYMENT AGREEMENT

Exhibit 10.1 Execution Version EMPLOYMENT AGREEMENT       THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of July 19, 2008, by and between H&R Block Management, LLC, a Delaware limited liability company (the "Company"), and Russell P. Smyth ("Executive").       WHEREAS, Executive is willing to serve the Company, and the Company is willing to employ Executive, on the terms and conditions set forth below.       NOW, THEREFORE, in consideration of the mutual promises contained herein and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed as follows: ARTICLE ONE EMPLOYMENT      1.01 Agreement as to Employment; Title; Employment Period. The Company hereby agrees to employ Executive to serve in the capacity of President and Chief Executive Officer of H&R Block, Inc., a Missouri corporation ("Block") and the indirect parent corporation of the Company, and Executive hereby accepts such employment by the Company, subject to the terms of this Agreement, for the period commencing on August 1, 2008 (the "Employment Commencement Date") and ending on July 31, 2011 (the "Employment Period"). After the expiration of the Employment Period, and provided that this Agreement is not extended or superseded by the mutual written consent of the parties, the provisions of Section 1.07 (relating to stock ownership requirements) and Articles Two through Five of this Agreement shall survive the expiration of the Employment Period and continue to be in effect to the extent applicable.      1.02 Duties; Board Membership; Performance and Other Activities.      (a)  Duties. During the Employment Period, Executive will have the duties, authorities and responsibilities commensurate with the duties, authorities and responsibilities of chief executive officers in similarly sized companies, and such other duties, authorities and responsibilities as the Board of Directors of Block (the "Block Board") designates from time to time that are not inconsistent with Executive’s position. Executive will report directly to the Block Board.      (b)  Board Membership. The Block Board shall take such action as may be necessary to appoint or elect Executive as a member of the Block Board as of the Employment Commencement Date. Thereafter, during the Employment Period, the Block Board shall nominate Executive for re-election as a member of the Block Board at the expiration of the then current term, provided that the foregoing shall not be required to the extent prohibited by legal or regulatory requirements. At no time while Executive is employed by the Company shall Executive serve as Chairman of the Block Board.      (c)  Performance and Other Activities. So long as Executive is employed under this Agreement, Executive agrees to devote Executive’s full business time and efforts exclusively on behalf of the Company and to competently and diligently discharge Executive’s duties

hereunder, provided that the foregoing shall not prevent Executive from (i) serving on the boards of directors of non-profit organizations and, with the prior written approval of the Block Board, one for profit public company, (ii) participating in charitable, civic, educational, professional, community or industry affairs, although any speaking engagements must be on behalf of Block and Executive may not receive any remuneration for such speaking engagements and (iii) managing his and his family’s passive personal investments, so long as such activities in the aggregate do not interfere or conflict with Executive’s full-time employment hereunder and do not violate the other provisions of this Agreement or the H&R Block, Inc. Code of Business Ethics & Conduct, which Executive acknowledges having read and understood. Executive will comply fully with all reasonable policies of the Company as are from time to time in effect and applicable to Executive’s position. Notwithstanding anything to the contrary in this Section 1.02(c), service on the two non-public, for profit boards of directors disclosed by Executive to the Company on which he is serving as of the date of this Agreement are hereby approved, except that it is agreed that Executive will use his best efforts to resign from one of those boards of directors by the first anniversary of the Employment Commencement Date.      1.03 Compensation.      (a)  Base Salary. During the Employment Period, the Company will pay to Executive a gross salary at an annual rate of $950,000 ("Base Salary"), payable semimonthly or at any other pay periods as the Company may use for its other executive-level employees. The Base Salary will be reviewed for potential increase, no less often than annually during the Employment Period, and may only be decreased as part of an across-the-board salary reduction that applies in the same manner to all executive-level employees. The Base Salary, as it may be adjusted from time to time, shall constitute the "Base Salary" for purposes of this Agreement.      (b)  Short-Term Incentive Compensation. Executive shall participate in Block’s short-term incentive program (which for certain highly compensated executives may include the H&R Block, Inc. Executive Performance Plan) (the "Program" ) as applicable to executives of the Company for its fiscal year 2009 (which ends April 30, 2009) and fiscal years thereafter. Under such Program, Executive shall have an aggregate target incentive award equal to 110% of Base Salary and an opportunity to earn a bonus at a maximum of 220% of Base Salary (prorated as described below). Notwithstanding the foregoing, under the Program for fiscal year 2009, Executive shall receive a minimum guaranteed short-term incentive compensation award equal to at least 110% of Base Salary, prorated based upon Executive’s actual Base Salary paid for the fiscal year (the "Minimum Guarantee" ). Other than the payment of the Minimum Guarantee, the payment of any award under the Program shall be based upon the achievement of one or more pre-established performance goals which shall be determined by the Compensation Committee of the Block Board, provided that Executive must remain employed through the end of the applicable fiscal year to receive any payments under the Program. Such incentive compensation, including the Minimum Guarantee, shall be paid to Executive following the completion of the fiscal year when the short-term incentive compensation is paid to other executive-level employees of the Company, which in any event shall be no later than two and one-half months after the end of the fiscal year to which it relates (or as soon thereafter as it can be properly determined).

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     (c)  Initial Stock Option Grant. The Compensation Committee of the Block Board shall grant Executive a nonqualified stock option (the "Option" ) to purchase 900,000 shares of Block’s common stock, without par value (the "Block Common Stock" ) on or as soon as practicable, but in no event later than 30 days, following the Employment Commencement Date. The Option shall be granted pursuant to, and shall be subject to, the terms and conditions of Block’s 2003 Long-Term Executive Compensation Plan, as amended (the "2003 Plan"), and the Company’s standard stock option agreement, with the following terms:           (i) Exercise Price. The Option shall be exercisable at the following prices:

          (ii) Vesting Schedule. Subject to accelerated vesting as set forth in this Agreement, the Option will vest and become exercisable as to one-third of the shares subject to each exercise price on each anniversary of the grant date (rounded down to the nearest whole number of shares for each vesting date, except that the amount vesting on the final vesting date shall be such that 100% of the aggregate number of shares of Block Common Stock subject to the Option shall be cumulatively vested as of the final vesting date), provided that Executive remains continuously employed by the Company through each vesting date.           (iii) Option Term. The Option is for a term of 10 years from the date of grant, subject to earlier termination as provided in the 2003 Plan and the underlying stock option agreement and in this Agreement.      (d)  Ongoing Equity Grants. In addition to the Option contemplated under this Section 1.03, when annual equity awards are granted to executives of Block generally, Executive shall be awarded additional grants of compensatory equity awards at a level commensurate with his position and performance, as determined by the Compensation Committee of the Block Board.      1.04 Relocation.      (a)  Relocation Benefits. Executive shall promptly relocate to the vicinity of Block’s principal U.S. headquarters. In accordance with Block’s Executive Relocation Program, the Company shall provide Executive with a relocation package commensurate with his position and will pay or reimburse Executive for the reasonable moving and relocation expenses and costs actually incurred by Executive in relocating to the Greater Kansas City Area, subject to the limitations and procedures set forth in Block’s Executive Relocation Program. During the period prior to his relocation (but in no event for more than three months following the Employment

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Commencement Date), the Company shall provide suitable temporary housing for Executive’s use when he is at Block’s principal U.S. headquarters. In addition, the Company shall reimburse Executive for the reasonable cost of two house hunting trips (to the extent not otherwise covered by Block’s Executive Relocation Program) for Executive and his family not to exceed $10,000 in the aggregate. All amounts payable under this Section 1.04(a) shall be subject to Executive’s presentment to the Company of appropriate documentation. To the extent that Executive incurs taxable income related to any relocation benefits paid or provided pursuant to this Section 1.04(a) of this Agreement, the Company will pay to Executive such additional amount as is necessary to "gross up" such benefits and cover the anticipated income tax liability resulting from such taxable income.      (b)  Cash Relocation Payment. The Company shall pay Executive a lump-sum cash relocation payment of $200,000 on the Employment Commencement Date to cover expenses not otherwise covered by Block’s Executive Relocation Program.      1.05 Business Expenses. Upon presentment to the Company of appropriate documentation, the Company will promptly pay directly, or reimburse Executive for, all business expenses, to the extent such expenses are paid or incurred by Executive during the Employment Period in accordance with the Company’s policy in effect from time to time and to the extent such expenses are reasonable and necessary to the conduct by Executive of the Company’s business. Upon presentation to the Company of appropriate documentation, the Company shall also pay directly, or reimburse Executive for, the reasonable legal fees actually incurred in connection with the negotiation and documentation of this Agreement, up to a maximum of $30,000.      1.06 Employee Benefits. During the Employment Period, and subject to the discretionary authority given to the applicable benefit plan administrators, the Company will make available to Executive insurance, sick leave, deferred compensation, vacation and other like benefits no less favorable than as approved and provided from time to time to the other executive-level employees of the Company. Coverage and eligibility for any such benefits are subject to the terms of the various plans as they may be amended from time to time pursuant to their respective terms. Executive will not have access to the company aircraft for personal use.      1.07 Stock Ownership Requirements. While employed by the Company, Executive shall not sell shares of Block Common Stock until Executive is holding shares of Block Common Stock (determined in accordance with the forms of ownership recognized under Block’s stock ownership guidelines for executive-level employees of the Company as in effect from time to time) with a value equal to at least five times Executive’s Base Salary (although there is no specific timetable for reaching such share retention threshold). In addition, after Executive has accumulated the required amount of shares of Block Common Stock, while employed by the Company, Executive must also hold 100% of the shares of Block Common Stock subsequently acquired (net of taxes and, if applicable, exercise price) pursuant to any compensatory equity award for a minimum of one year from the date of acquisition (whether through exercise of stock options or vesting of any other stock-based award, as applicable).

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ARTICLE TWO TERMINATION OF EMPLOYMENT      2.01 Termination of Employment .      (a)  No Reason Required. The Company or Executive may terminate Executive’s employment and the Employment Period at any time for any reason, or for no reason, subject to compliance with Section 2.01 (c).      (b)  Related Definitions.      (i) "Cause" means any of the following unless, if capable of cure, such events are fully corrected in all material respects by Executive within 10 days after the Company gives a Termination Notice:      (A) Executive’s misconduct that materially interferes with or materially prejudices the proper conduct of the business of Block, the Company and/or any direct or indirect subsidiary of Block (each such other subsidiary an "Affiliate" ) or which may reasonably result in harm to the reputation of Block, the Company and/or any Affiliate; or      (B) Executive’s commission of an act materially and demonstrably detrimental to the good will of Block, the Company and/or any Affiliate, which act constitutes gross negligence or willful misconduct by Executive in the performance of Executive’s material duties to Block, the Company and/or such Affiliate; or      (C) Executive’s commission of any act of dishonesty or breach of trust resulting or intending to result in material personal gain or enrichment of Executive at the expense of Block, the Company and/or any Affiliate; or      (D) Executive’s violation of Article Three or Section 4.02, 4.03, 4.05 or 4.06 of this Agreement; or      (E) Executive’s conviction of, or plea of nolo contendere to, a misdemeanor involving an act of moral turpitude or a felony.      If the Company does not give Executive a Termination Notice (as described in Section 2.01(c)) within 60 days after the Block Board or the Chairman of the Block Board has knowledge that an event constituting Cause has occurred, the event will no longer constitute Cause. The Company may place Executive on unpaid leave for up to 30 consecutive days while it is determining whether there is a basis to terminate Executive’s employment for Cause. This leave will not constitute Good Reason.      For purposes of this definition, (1) no act or omission by Executive will be "willful" unless it is made by Executive in bad faith or without a reasonable belief that Executive’s act or omission furthered the interests of the Company, Block and/or the Affiliates and (b) any act or

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omission by Executive based on authority given pursuant to a resolution duly adopted by the Block Board will be deemed made in good faith and in the best interests of the Company, Block and/or the Affiliates.      (ii) "Change in Control" means:      (A) the acquisition, other than from Block, by any individual, entity or group (within the meaning of Section 13(d) (3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of the then outstanding voting securities of Block entitled to vote generally in the election of directors, but excluding, for this purpose, (i) any such acquisition by Block or any of its subsidiaries, or any employee benefit plan (or related trust) of Block or its subsidiaries, (ii) any corporation with respect to which, following such acquisition, more than 50% of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the shareholders who were the beneficial owners of the voting securities of Block immediately prior to such acquisition in substantially the same proportion as their ownership, immediately prior to such acquisition, of the then outstanding voting securities of Block entitled to vote generally in the election of directors, (iii) pursuant to any acquisition by Executive or any group of persons including Executive, or (iv) by any underwriter temporarily holding securities pursuant to an offering of such securities; or      (B) during any 12-month period, individuals who, as of the date hereof, constitute the Block Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Block Board, provided that any individual or individuals becoming a director subsequent to the date hereof, whose election, or nomination for election by Block’s shareholders, was approved by a vote of at least two-thirds of the Block Board (or nominating committee of the Block Board) will be considered as though such individual were a member or members of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the directors of Block (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act); or      (C) the completion of a reorganization, merger or consolidation of Block, in each case, unless following such reorganization, merger or consolidation, the shareholders who were the beneficial owners of the voting securities of Block immediately prior to such reorganization, merger or consolidation continue to beneficially own, directly or indirectly, more than 50% of the then outstanding voting securities entitled to vote generally in the election of directors of the corporation resulting from such reorganization, merger or consolidation in substantially the same proportion as their ownership, immediately prior to such reorganization, merger or consolidation, of the voting securities of Block entitled to vote generally in the election of directors; or

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     (D) a complete liquidation or dissolution of Block or the consummation of a sale or other disposition of all or substantially all of the assets of Block to an entity that is not an affiliate of Block.      (iii) "Disability " means Executive’s absence from Executive’s responsibilities with the Company on a full-time basis for 130 business days in any consecutive 12 months as a result of incapacity due to mental or physical illness or injury. If the Company determines in good faith that Executive’s Disability has occurred, it may give Executive a Termination Notice. If within 30 days of the Termination Notice Executive does not return to full-time performance of Executive’s responsibilities, Executive’s employment will terminate. If Executive does return to full-time performance in that 30-day period, the Termination Notice will be cancelled for all purposes of this Agreement. Except as provided in this Section 2.01(b)(iii), Executive’s incapacity due to mental or physical illness or injury will not affect the Company’s obligations under this Agreement (including that such illness or injury will not constitute a basis for Cause).      (iv) "Good Reason " means any of the following events, without the express written consent of Executive, unless such events are fully corrected in all material respects by the Company within 30 days after Executive gives a Termination Notice:      (A) A material diminution in Executive’s base compensation;      (B) A material diminution in Executive’s authority, duties, or responsibilities as President and Chief Executive Officer of Block, reporting directly to the Block Board (but, if Block becomes a subsidiary of another entity, "Block Board" shall be deemed to refer to the board of directors (or other governing body) of the ultimate parent entity of Block); or      (C) A material change in the geographic location at which Executive must perform the services; or      (D) Any other action or inaction that constitutes a material breach by the Company of this Agreement.      If Executive does not give a Termination Notice within 60 days after Executive has knowledge that an event constituting Good Reason has occurred, the event will no longer constitute Good Reason.      (c)  Advance Notice Generally Required.      (i) To terminate Executive’s employment, either Executive or the Company must provide a Termination Notice to the other. A "Termination Notice" is a written notice that states the specific provision of this Agreement on which termination is based, including, if applicable, the specific clause of the definition of Cause or Good Reason and a reasonably detailed description of the facts that permit termination under that clause; provided that the failure to include any fact in a Termination Notice that contributes to a showing of Cause or Good Reason does not preclude either party from asserting that fact in enforcing its rights under this Agreement.

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     (ii) Executive and the Company agree to provide the Termination Notice at least 60 days in advance of any termination, unless (A) Executive’s employment is terminated by the Company for Cause or because of Executive’s death, in which case the termination may be effective immediately, or (b) Executive’s employment is terminated because of Executive’s Disability, in which case the provisions of Section 2.01(b)(iii) shall apply. If Executive dies or becomes Disabled after Executive provides a valid Termination Notice with Good Reason or the Company provides Termination Notice without Cause, Executive’s termination will be treated as a termination with Good Reason, effective as of the date of Executive’s death or Disability. If Executive provides a Termination Notice, the Company may, in its sole discretion, relieve Executive of his duties, responsibilities and title during the period prior to Executive’s termination date; provided, however, that during such period Executive shall remain an employee of the Company with the same compensation and benefit arrangements as in place immediately prior to Executive’s delivery of the Termination Notice.      2.02 Obligations of the Company upon Termination.      (a)  Other than For Cause; For Good Reason. If, at any time on or before July 31, 2014 (the "Protected Period" ), the Company shall terminate Executive’s employment other than for Cause or Disability, or Executive shall terminate employment for Good Reason, the Company shall have no further obligations to Executive other than:  &