Intuit, the parent company of tax filing software TurboTax, will pay $141 million in restitution to about 4.4 million Americans.
The 50-state settlement, led by New York Attorney General Letitia James, alleges that the company “defrauded” low-income Americans by diverting and redirecting them away from free tax filing services (for which they may be eligible). Gave. paid version of its service, and was later “incorrectly charged.”
“TurboTax’s predatory and deceptive marketing defrauded millions of low-income Americans who were trying to meet their legal duty to file their taxes,” James said in a statement. “Today we are righting that wrong and putting money back in the pockets of hardworking taxpayers who should never have paid to file their taxes.”
Eligible individuals include those who paid to file their federal taxes with TurboTax in 2016, 2017 and 2018, but were eligible to file for free through the IRS Free File program — about two of which were two years ago. Until Intuit was a partner.
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In 2019, ProPublica published a report alleging that since the launch of its participation in Intuit’s Free File program in 2003, it had gone to extreme lengths to limit the program’s reach—suspicion of lobbying tactics. From adding code to the Free File landing page to making it virtually unreachable to search engines.
About two months after the story was published, the IRS implemented a new rule that bars major tax software companies (like Intuit) from hiding free tax filing options from search engines.
Then, in 2021, Intuit decided not to renew its participation in the Free File Program. The company attributes its decision to “limitations” in the program and “conflicting demands from people outside the program”.
In a blog post about the 50-state settlement in May 2022, Intuit said, “In coming to a resolution on this matter, we did no wrong and will continue to build on our strong partnerships with governments to serve the needs of taxpayers.” Happy to be able to continue. Country.” In Entrepreneur’s Requested for comment regarding the allegations, the company referred to the above post from last May.
Those affected by the settlement will receive an email, and a check will be sent in the mail through the month of May 2023. Most eligible individuals will receive approximately $30, although others may receive up to $85, based on the number of years they have been eligible. More information about settlement can be found here.
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