Colorado Springs

$2.5 million to go to Coloradans deceived by TurboTax – Colorado Springs, Colorado

Colorado Springs, Colorado 2022-05-04 16:06:08 –

Denver — Attorney General Phil Weiser has announced that his office has secured more than $ 2.5 million for tens of thousands of Colorados who have been fooled into paying tax services that should be free.

TurboTax owner Intuit Inc. has reached a settlement to remedy the harm experienced by low-income consumers and military personnel who have fallen into false advertising for the company.

After ProPublica reported the use of deceptive digital tactics by TurboTax, a multilateral investigation with the support of the Federal Trade Commission was prompted. The company has found that it is directing low-income consumers to its products and away from federal-backed free tax services.

“We offer a free tax return service to help low-income Coloradans file taxes with as little impact on their daily lives and notebooks as possible,” Weiser said.

TurboTax Free File is a public-private partnership with the federal government. It’s a federal-supported free service through the IRS Free File Program that allows taxpayers to earn about $ 34,000 and military members to file taxes for free. In addition to File Free products, Intuit offers a commercial “Turbo Tax Free Edition”. It is only available free of charge to Intuit-defined “simple returns” taxpayers. TurboTax sold the free version through advertising campaigns where “free” is the most prominent, or sometimes the only selling point. In fact, this product was free for only about 33% of US taxpayers. In contrast, 70% of taxpayers are eligible for free filing under the TurboTax Free File.

Investigations have confirmed that Intuit engages in some deceptive and unfair trading practices that limit consumer participation in the IRS FreeFile Program. This included using similar names that were confusing for both the IRS Free File and its “freemium” product, the Turbo Tax Free Edition.

In addition, Intuit deliberately manipulated consumer search results to direct consumers to paid products. According to a press release from the Office of the Justice Office, TurboTax will deliberately block the IRS Free File landing page from search engine results during the 2019 tax filing season, allowing qualified taxpayers to pay taxes for free. Was virtually blocked. In addition, the TurboTax website included a “Products and Prices” page stating “Recommend the right tax solution”, but even if the consumer is not eligible for TurboTax Free Edition, IRSFreeFile We did not view or recommend the program.

Under the settlement, Intuit has agreed to pay affected consumers about $ 30 each year, fooled by the payment of the free version of TurboTax for the 2016-2018 tax year. This includes over 80,000 payments in Colorado alone. Affected consumers will automatically receive notifications and checks by mail.

“Through today’s settlement, we are returning some of the money that was illegally stolen from the hard-working residents of the state,” Weiser said. “We continue to stand for vulnerable consumers being used by irresponsible businesses.”

In addition, Intuit has agreed to suspend TurboTax’s “free, free, free” advertising campaign. This forced consumers to pay, despite the promise of free tax preparation services. TurboTax has also agreed to reform other potentially misleading business and advertising practices.

All 50 states and the District of Columbia have joined the agreement. Under this agreement, Intuit will have to pay $ 141 million nationwide.

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