Intuit, the company behind TurboTax, has agreed to pay out $141 million after it “cheated millions of low-income Americans out of free tax filing services,” in the words of New York Attorney General Letitia James. Most of that money will go to consumers that were tricked into paying for its service. This comes as the result of an agreement it made with the AG (and officials from all 50 states and DC), which will also require the company to change its marketing practices.
According to the Attorney General’s press release, Intuit will owe people $30 for every year they were tricked into paying for TurboTax between 2016 and 2018. The document notes that “impacted consumers will automatically receive notices and a check by mail.”
TurboTax has long been maligned for being opaque and having deceptive marketing. For years there were two versions of its tax preparation software that had “free” in the name: TurboTax Free Edition, and TurboTax Free File. Intuit, according to the AG, heavily marketed the Free Edition as being, well, free (the press release points out that some ads used the word “dozens of times in as short as 30 seconds”). But around 4.4 million people ended up owing Intuit money when using it.
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. The program came from a…
