Intuit to Pay $141 Million to Settle Multistate Probe into its TurboTax “Free” Tax Filing Ads

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Moreover, Intuit will stop requiring consumers to redo their tax filing if they exit one of its paid products to use a free product instead.

In a statement, New York State Attorney General Letitia James said, “Intuit cheated millions of low-income Americans out of free tax filing services they were entitled to. 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.”

New York will receive more than $5.4 million for more than 176,000 New Yorkers deceived by Intuit’s deceptive marketing of TurboTax.

All 50 states and the District of Columbia signed the agreement, according to New York State Attorney General Letitia James, who co-led the multistate investigation into Intuit’s business practices.

Intuit’s deceptive marketing tactics

The investigation found that the company offered two free versions of TurboTax. One was through the IRS Free File Program, which allows taxpayers earning around $34,000 and members of the military to file their tax returns for free. The other one was its “freemium” product called “TurboTax Free Edition,” which is only free for taxpayers with simple returns.