Maine Turbotax Users in 2016-18 May Get Some of $141M Settlement
A $141 million settlement of a class-action suit against Turbotax will benefit any Mainers who were deceived into paying for their 'free' services between 2016 and 2018.
How Did Intuit TurboTax Mislead Taxpayers?
The suit was filed by all 50 states and the District of Columbia against the online tax preparation services provider that is accused of using deceptive language in its advertising. Specifically, they're accused of using the word 'free' for tax prep services that ultimately cost the consumer money.
Intuit offers two free versions of TurboTax. One is an IRS Free File Program, which is a public-private partnership with the IRS and offers free filing for taxpayers earning roughly $34,000 a year and members of the military. The other is their commercial product called 'TurboTax Free Edition.' This was promoted as being free for taxpayers with simple returns, as defined by Intuit. While their ads were very aggressive in promoting the 'freemium,' as they called it, the product was actually only free for about 1/3 of taxpayers. In contrast, the IRS version was free for about 70% of taxpayers.
How is Maine's Attorney General Reacting to the Settlement?
Maine Attorney General Aaron Frey calls it a 'classic bait and switch,' with empty promises that lured Maine residents in and then tacked on unexpected fees.
Citizens should be able to trust that advertisements mean exactly what they say, especially for services like tax filing that can be confusing and stressful. I'm pleased that consumers deceived by Intuit's false advertising will receive financial compensation.
How Much Will I Get?
Qualifying Maine residents can expect a check for approximately $30 for every year that they were deceived into paying for filing services. Impacted customers don't need to do anything to get the payouts. They will automatically receive notices and a check by mail. No timeline has been given for when those payments will be sent out.
In an agreement with all states, Intuit has committed to paying $141 million dollars in restitution to compensate taxpayers who paid fees that had been advertised as free. $701,357.86 of that is coming to Maine and will be distributed to residents who used the online platform to do their taxes.