Impacted consumers will automatically receive notices and a check by mail. Consumers are expected to receive a direct payment of approximately $30 for each year that they were deceived into paying for filing services.
#Taxact vs turbotax 2011 for free#
Under the agreement, Intuit will provide restitution to nearly 4.4 million consumers who started using TurboTax’s Free Edition for tax years 2016 through 2018 and were told that they had to pay to file even though they were eligible to file for free using the IRS Free File program offered through TurboTax. Intuit will pay $141 million in restitution, of which roughly $2.5 million will be used for administrative fund costs. Moreover, TurboTax’s website included a “Products and Pricing” page that stated it would “recommend the right tax solution,” but never displayed or recommended the IRS Free File program, even when consumers were ineligible for the “freemium” product. Intuit also purposefully blocked its IRS Free File landing page from search engine results during the 2019 tax filing season, effectively shutting out eligible taxpayers from filing their taxes for free. Intuit bid on paid search advertisements to direct consumers who were looking for the IRS Free File service to the TurboTax “freemium” product instead. The company used confusingly similar names for both its IRS Free File product and its commercial “freemium” product. The OAG’s multistate investigation found that Intuit engaged in several deceptive and unfair trade practices that limited consumers’ participation in the IRS Free File Program. In contrast, the IRS Free File products were free for 70 percent of taxpayers. However, the TurboTax “freemium” product is only free for approximately one-third of US taxpayers. In some ads, the company repeated the word “free” dozens of times in as short as 30 seconds. In recent years, TurboTax marketed this “freemium” product aggressively, including through ad campaigns where “free” is the most prominent or sometimes the only selling point. In addition, Intuit offers a commercial product called “TurboTax Free Edition,” which is only free for taxpayers with “simple returns” as defined by Intuit. In exchange for participating in the program, the IRS agreed not to compete with Intuit and other tax-prep companies by providing its own electronic tax preparation and filing services to American taxpayers.
One was through its participation in the IRS Free File Program, a public-private partnership with the Internal Revenue Service (IRS), which allows taxpayers earning roughly $34,000 and members of the military to file their taxes for free. Intuit offered two free versions of TurboTax. The Office of the Attorney General (OAG) opened an investigation into Intuit after ProPublica reported that the company was using deceptive digital tactics to steer low-income consumers toward its commercial products and away from federally-supported free tax services. New Yorkers can count on my office to protect their wallets from white-collar scammers.” This agreement should serve as a reminder to companies large and small that engaging in these deceptive marketing ploys is illegal. Today, every state in the nation is holding Intuit accountable for scamming millions of taxpayers, and we’re putting millions of dollars back into the pockets of impacted Americans.
“For years, Intuit misled the most vulnerable among us to make a profit. “Intuit cheated millions of low-income Americans out of free tax filing services they were entitled to,” said Attorney General James. New York will receive more than $5.4 million for more than 176,000 New Yorkers who were tricked into paying to file their federal tax return. All 50 states and the District of Columbia have signed onto the agreement.
In addition, Intuit must suspend TurboTax’s “free, free, free” ad campaign that lured customers with promises of free tax preparation services, only to deceive them into paying. As a result of Attorney General James’ agreement, Intuit will pay $141 million in restitution to millions of consumers across the nation who were unfairly charged. (Intuit), for deceiving millions of low-income Americans into paying for tax services that should have been free. NEW YORK – New York Attorney General Letitia James today announced a record multistate agreement with the owner of TurboTax, Intuit Inc. New York Will Receive Over $5.4 Million for More Than 176,000 New Yorkers AG James Leads All 50 States in Agreement with TurboTax Owner Intuit forĭeceiving Low-Income Americans into Paying for Free Tax Services
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