![]() James’ office said its investigation came after a 2019 ProPublica report accused the company of steering eligible clients away from federally supported tax filing products by making them difficult to find in web searches - instead directing them toward the paid version of the company’s filing services. (INTU) said that it “admitted no wrongdoing” as part of the agreement and it expects “minimal impact to its business” from the changes demanded in the future. The settlement, announced Wednesday by New York Attorney General Letitia James, said about 4.4 million customers were “unfairly charged.” Intuit must also suspend its “free, free, free” ad campaign because it falsely lured customers with the promise of free tax preparation services, the statement added. For more information about who is covered by the settlement, and information about the settlement fund, visit the owner of tax filing software TurboTax, has agreed to pay $141 million in a settlement with all 50 states for allegedly steering millions of low-income Americans away from free tax-filing services. Most consumers are expected to receive between $29 and $30. The amount each consumer receives will be based on the number of tax years for which they qualify. ![]() These consumers will receive a check in the mail automatically, without filing a claim. Consumers who are eligible for a payment will be notified by email by the settlement fund administrator, Rust Consulting. All 50 states and the District of Columbia signed onto the agreement.Įligible consumers include those who paid to file their federal tax returns through TurboTax for tax years 2016, 20 but were eligible to file for free through the IRS Free File Program. Subsequently, New York Attorney General Letitia James, with assistance from the attorneys general of Tennessee, Florida, Illinois, New Jersey, North Carolina, Pennsylvania, Texas, and Washington, announced a $141 million multistate agreement with Intuit for deceiving millions of low-income Americans into paying for tax services that should have been free. A legal action was initiated in April 2022 “to immediately halt this bait-and-switch, and to protect taxpayers at the peak of filing season.” TurboTax was “bombarding consumers with ads for ‘free’ tax filing services, and then hitting them with charges” when it was time to file, said Samuel Levine, director of the Bureau of Consumer Protection. What “simple” means can be a matter of interpretation, and Intuit’s definition of “simple” changed over time. Since at least 2017, Intuit called the “freemium” version of TurboTax the “TurboTax Free Edition.” In 2016, Intuit called the “freemium” version of TurboTax the “Federal Free Edition.” The “freemium” version of TurboTax was available only to consumers with “simple” tax returns, as defined by Intuit other consumers were required to upgrade to paid versions of TurboTax. According to the administrative complaint, since at least 2016, it was only after people spent time entering sensitive personal and financial information that many learned they’d need to upgrade to a paid TurboTax product to complete and file their taxes. ![]() In truth, TurboTax was free for only some users, based on the tax forms they need. In 2020, for example, approximately two-thirds of tax filers could not use TurboTax’s free product. ![]() In fact, most tax filers couldn’t use the company’s “free” service because it was not available to millions of taxpayers, such as those who got a 1099 form for work in the gig economy, or those who earned farm income. The FTC alleged that the company’s ubiquitous advertisements touting their supposedly “free” products – some of which consisted almost entirely of the word “free” spoken repeatedly – mislead consumers into believing they could file their taxes for free with TurboTax. The Federal Trade Commission issued an administrative complaint against the company for deceiving consumers with advertisements pitching “free” tax filing that millions of consumers could not use. Checks will be mailed throughout this month, Drummond said. Eligible consumers will be contacted by email about the settlement and will not need to file a claim. Oklahoma will receive more than $1.7 million for more than 56,000 people who were tricked into paying to file their federal tax return. OKLAHOMA CITY - Consumers who were tricked by TurboTax owner Intuit into paying for free tax services will begin receiving checks from a $141 million multistate settlement, Attorney General Gentner Drummond announced recently.Īpproximately 4.4 million consumers nationwide will receive checks in the mail from the multistate settlement.
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