SALT LAKE CITY – If you tried to use a free version of TurboTax but ended up paying anyway, you could be getting some money back in a multi-state settlement. Utah Division of Consumer Protection has announced it secured over $1.37 million in restitution from Intuit Inc., the owner of TurboTax, for deceiving consumers into paying for tax services that should have been free. The agreement resulted in Intuit paying $141 million in restitution to millions of customers across the country who were unfairly charged. Intuit was also ordered to suspend its “free, free, free” advertising campaign, which lured customers with promises of free tax preparation services and then deceived them into paying for the services.
“Intuit tricked people into paying to file their taxes instead of directing them towards the federally supported free tax services,” according to the Utah Department of Commerce’s Executive Director Margaret Busse. “This settlement is a reminder to all that those who perpetrate deceptive practices will be held accountable.”
Intuit is to provide restitution to customers who started using TurboTax’s Free Edition for tax years 2016 through 2018 and were told they had to pay to file, even though they were eligible to file for free using the version of TurboTax offered as part of the IRS Free File program. Impacted customers will automatically receive notices and a check by mail for approximately $29 for each year they were deceived into paying for filing services.
“We are pleased with the settlement,” said Director Katherine Hart of the Utah Division of Consumer Protection in a release. “Settlement checks are in the mail, and impacted consumers should see them soon.”
Furthermore, Intuit has agreed to reform its business practices, including enhancing disclosures in its advertising and marketing of free products, designing its products to better inform users whether they will be eligible to file their taxes for free, and refraining from requiring consumers to start their tax filing over if they exit one of Intuit’s paid products to use a free product instead.
The investigation was led by New York and Tennessee with support from the attorneys general of Florida, Illinois, New Jersey, North Carolina, Pennsylvania, Texas, and Washington. All 50 states and the District of Columbia joined this agreement.