Geithner made it clear that he took responsibility for the error, which was discovered in a subsequent IRS audit, and did not blame TurboTax. Intuit responded by releasing a statement saying “TurboTax, and all software and in-person tax preparation services, base their calculations on the information users provide when completing their returns.” Guided Tax Preparation provides free online tax preparation and filing at an IRS partner site. Our partners deliver this service at no cost to qualifying taxpayers.

Deluxe version plus investment reporting and rental income (Schedules D and E, and K-1s). No action needs to be taken, according to Halimah Elmariah, a spokesperson for the New York State Attorney’s Office. Eligible TurboTax users will receive notification, either in an email or letter. By submitting your email, you agree to our Terms and Privacy Notice. If you share republished stories on social media, we’d appreciate being tagged in your posts. We have official accounts for ProPublica on Twitter, Facebook and Instagram.

Turbotax Review 2022

NEW YORK – New York Attorney General Letitia James today announced a record multistate agreement with the owner of TurboTax, Intuit Inc. , for deceiving millions of low-income Americans into paying for tax services that should have been free. 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. 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.

However, eligibility for free filing through the IRS is based solely on the taxpayer’s income, regardless of what forms or schedules the IRS requires them to complete for their return. These people were told they had to pay to file, even though they qualified for the IRS Free File program, a partnership between the agency and major tax prep software companies. Individuals and families with an adjusted gross income of less than $73,000 are typically eligible for the Free File program, as are members of the military. In March, the FTC sued Intuit,alleging that, in 2020 alone, two thirds of eligible filers couldn’t use TurboTax Free Edition, including gig workers and people who earned farm income. Investigators said Intuit also engaged in deceptive marketing and trade practices, intentionally blocking its IRS Free File landing page from search engine results. The company also lured people in with ads that touted its free edition “only to deceive them into paying,” according to New York Attorney General Letitia James, who brokered the multistate settlement. What they should’ve used was the hard-to-find Free File version, which was part of the Internal Revenue Service’s Free File program.

Series: The Turbotax Trap

In some ads, the company repeated the word “free” dozens of times in as short as 30 seconds. However, the TurboTax “freemium” product is only free for approximately one-third of US taxpayers. In contrast, the IRS Free File products were free for 70 percent of taxpayers. Intuit also offered a commercial product called “TurboTax Free Edition,” which is only free for taxpayers with “simple returns” as defined by Intuit. In recent years, TurboTax has marketed this “freemium” product aggressively, including through ad campaigns where “free” is the most prominent or sometimes the only selling point. In contrast, the TurboTax Free File product was free for 70 percent of taxpayers. The AG noted that Intuit bid on paid search advertisements to direct customers looking for the IRS Free File product to the TurboTax “freemium” product instead.

We collect data directly from providers, do first-hand testing and observe provider demonstrations. The questions are structured to equally elicit both favorable and unfavorable responses. They are not designed or prepared to produce any predetermined results. The provider’s answers, combined with our specialists’ hands-on research, make up our proprietary assessment process that scores each provider’s performance. With its intuitive design and variety of human support options, TurboTax is in many ways the standard for the do-it-yourself tax-prep industry. Its products come at a price, however, and confident filers might find that similar offerings from competitors may provide a better value.

Choose From Irs Free File:

Certain custody and other services are provided by JPMorgan Chase Bank, N.A. JPMS, CIA and JPMCB are affiliated companies under the common control of JPMorgan Chase & Co. With Business TurboTax Banking, you’ll receive guidance from a team of business professionals who specialize in helping improve cash flow, providing credit solutions, and on managing payroll.

• The company has been subject of controversy over its political influence and deceptive business practices.
• The IRS Free File landing page was even blocked from Intuit search engine results during the 2019 tax filing season.
• Congress ultimately removed the provision that would have enshrined Free File in law.
• This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
• Intuit Inc., the fintech company behind the tax filing software, has reached a $141 million settlement for allegedly ripping off low-income users.

In March 29, 2022, the Federal Trade Commission announced that they would take legal action against Intuit, the parent company of https://www.bookstime.com/ in response to deceptive advertising of its free tax filing products. The commission reported that the majority of tax filers cannot use any of TurboTax’s free products which were advertised, claiming that it has misled customers to believing that tax filers can use TurboTax to file their taxes. In addition, tax filers who earn farm income or are gig workers cannot be eligible for those products. Intuit announced that they would take counter action, announcing that the FTC’s arguments are “not credible” and claimed that their free tax filing service is available to all tax filers. TurboTax has tricked military service members to pay to use the filing software by creating and promoting a “military discount” and by making the free version hard to find when many service members are in fact eligible to use the software for free.

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Intuit had again bent the power of the federal government in its favor. After 2005, the Free File program was never again as popular, eventually falling to about half that year’s level. Clearly, wrote Renata Hesse, an antitrust section chief at the department, “any agreement among Alliance members to restrict such free service is likely a form of price fixing” and thus illegal. She wrote that if the IRS itself were to impose such a restriction, it would be legal. Last fall, Intuit’s longtime CEO Brad Smith embarked on a farewell tour of the company’s offices around the world. Smith had presided over 11 years of explosive growth, a period when Intuit had secured its place in the Silicon Valley pantheon, and the tour was like a long party. Since Intuit has exited the IRS Free File program, we no longer offer IRS Free File Program delivered by TurboTax, formerly known as TurboTax Free File Program and TurboTax Freedom Edition.

First, be sure you know the difference between “support” and “defense.” With most providers, audit support (or “assistance”) typically means guidance about what to expect and how to prepare — that’s it. Audit defense, on the other hand, gets you full representation before the IRS from a tax professional. TurboTax is generally pricier than everything else out there, but even though confident filers may not need all the bells and whistles that most TurboTax online products offer, many people will find the experience and the availability of human help worth the extra cost. We believe everyone should be able to make financial decisions with confidence. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free.

“Free tax filing services are offered for a reason — to ensure lower-income Coloradans can file their taxes with as little impact to their daily lives and pocketbooks as possible,” Weiser said. Low-income and military residents are offered federally supported free tax services in a public-private partnership with TurboTax Free File and the IRS Free File Program, allowing those making $34,000 or less annually and military members to file their taxes for free.

Heres What Our Customers Have To Say

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. The company used confusingly similar names for both its IRS Free File product and its commercial “freemium” product. Intuit bid on paid search advertisements to direct consumers who were looking for the IRS Free File service to the TurboTax “freemium” product instead. 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. 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. The multistate investigation found that Intuit engaged in several deceptive and unfair trade practices that limited consumers’ participation in the IRS Free File Program. The company created confusion by using similar names for both its IRS Free File product and its commercial “freemium” product.

• The programming error was reportedly fixed, but as of 2012 TurboTax offers no option to download a data file directly from the financial institution.
• In 2021, some individuals who used Turbotax for their tax filings were unable to access stimulus checks sent by the government because Turbotax diverted the checks to old and unused bank accounts for the customers.
• The company behind the TurboTax tax-filing program will pay $141m to customers across the United States who were deceived by misleading promises of free tax-filing services, New York’s attorney general announced Wednesday.
• The settlement also requires the company to suspend TurboTax’s “free, free, free” ad campaign that lured consumers with promises of free tax preparation services, only to deceive them into paying for services.
• As late as 2001, around 45 million Americans still filled out their tax forms on paper.

TurboTax Digital Assistant and contact form available for all; paid packages get access to a TurboTax specialist. Embedded links throughout the process offer tips, explainers and other resources. And help buttons can connect you to the searchable knowledge base, on-screen help and more. The list price of its software routinely is on the high end of the spectrum, especially when adding the cost of a state return.

But the company deliberately employed “several deceptive and unfair trade practices” to drive customers away from participating in the federal program, Ms. James said. Methods included buying search engine advertisements to guide people from the federal program to TurboTax’s “free” commercial product, and, in 2019, even blocking the landing page for its free service from appearing in search engine results. What is clear is that Intuit’s business relies on keeping the use of Free File low. The company has repeatedly declined to say how many of its paying customers are eligible for the program, which is currently open to anyone who makes under $66,000. But based on publicly available data and statements by Intuit executives, ProPublica estimates that roughly 15 million paying TurboTax customers could have filed for free if they found Free File. That represents more than $1.5 billion in estimated revenue, or more than half the total that TurboTax generates. Those affected include retirees, students, people on disability and minimum-wage workers.

TurboTax also offers Live Full Service, which does away with tax software altogether. Instead, you upload your tax documents and a human puts together your tax return. You’ll be matched with a tax preparer, meet on a video call before he or she begins working, and then you’ll meet again when your return is ready for review. Prices range from $199 to $389 for federal returns depending on complexity, plus $54 per state return. Ms. James’s office led a multistate investigation into Intuit’s misleading advertising after reporting by ProPublica found that the company deceived customers who were eligible for free tax services and instead rerouted them to enroll in paid versions. “Intuit cheated millions of low-income Americans out of free tax filing services they were entitled to,” James said in a statement. “For years, Intuit misled the most vulnerable among us to make a profit. 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.”

These numbers are subject to change, said Halimah Elmariah, a spokeswoman for Ms. James. You can’t use our work to populate a website designed to improve rankings on search engines or solely to gain revenue from network-based advertisements.

Intuit Owes You Money If It Tricked You Into Paying For Turbotax free Edition

Impacted consumers will automatically receive notices explaining the reimbursement process. Additional details on the agreement are available on the Wisconsin Department of Justice’s Website. Intuit, the owner of TurboTax, spent more than $11 million on federal lobbying between 2008 and 2012. Intuit “opposes IRS government tax preparation”, particularly allowing taxpayers to file pre-filled returns for free, in a system similar to the established ReadyReturn service in California. The company also lobbied on bills in 2007 and 2011 that would have barred the Treasury Department, which includes the IRS, from initiating return-free filing. 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 recent years, TurboTax marketed this “freemium” product aggressively, including through ad campaigns where “free” is the most prominent or sometimes the only selling point.

We’ll find every tax deduction and credit you qualify for to boost your tax refund. Do not include sensitive information, such as Social Security or bank account numbers. You might be able to use a portion of your home’s value to spruce it up or pay other bills with a Home Equity Line of Credit.

This also caused it to conflict with some boot loaders that store data there, rendering those computers unbootable. If you’re republishing online, you must link to the URL of this story on propublica.org, include all of the links from our story, including our newsletter sign up language and link, and use our PixelPing tag. Justin Elliott is a ProPublica reporter covering politics and government accountability. To securely send Justin documents or other files online, visit our SecureDrop page. In early October, the council sent a version of its final report, which included a harsh appraisal of the Free File program, to the IRS to seek responses before releasing it publicly the following month. A few days later, Ryan arrived at the IRS’ Constitution Avenue headquarters in Washington to mount a defense of the program.