According to the letter issued on April 18, Sen. Elizabeth Warren, D-Massachusetts, Rep. Katie Porter, D-Calif., and Rep. Brad Sherman, D-Calif., wrote to Intuit, the producer of TurboTax, demanding answers concerning the alleged “deceptive promotions of its ‘bogus’ free tax preparation products.”
Intuit was also accused of “unethical use of the revolving door to engage former regulators to defend its unscrupulous business practises that defraud taxpayers of billions of dollars,” according to the letter.
“In light of this new revelation and Intuit’s history of lobbying to protect its shady business practises,” the letter continued, “we seek to understand the extent to which Intuit has used former government officials to defend and maintain its unethical and potentially illegal practises that have cost American taxpayers billions of dollars.”
Warren said that TurboTax’s Free File programme duped taxpayers into paying for services that should have been free, citing a case brought by the Federal Trade Commission (FTC) against Intuit in March.
“Free File was designed to cover 70% of American taxpayers, but only around 3% of taxpayers engaged each year as of 2018,” the letter stated.
“Intuit quit the Free File programme in 2021, ‘throw[ing] the program’s future into doubt,’ after battling for years to keep it in place and even seeking to codify it into law to prevent the IRS from producing a genuinely free alternative.’
Despite renegotiating its memorandum of agreement (MOU) with the Free File Alliance in 2021 to remove the section forbidding the IRS from doing so, the IRS has yet to put up a government-run alternative “the letter went on.
Intuit said in an emailed statement to FOX TV Stations that it is working on a response to the legislators’ letter.
“Intuit is committed to putting Americans at the heart of their financial lives, and we are happy to have assisted more taxpayers in filing their taxes for free than all of our competitors combined. Intuit’s free tax preparation service has helped approximately 100 million Americans file their taxes for free in the last eight years alone. We are upfront and honest with our clients, as well as open and transparent about our advertising activities, and our participation in the Free File programme was carried out in accordance with IRS regulations and with the IRS’s monitoring. We are analysing Sen. Warren’s and other legislators’ letters and will reply as soon as possible “According to a corporate spokeswoman.
Meanwhile, the Federal Trade Commission (FTC) announced in March that millions of customers — two-thirds of tax filers in 2020 — would be unable to use the free tax-preparation software option. If they work as gig workers or receive agricultural income, for example, they are disqualified, according to the agency.
“TurboTax is bombarding customers with advertisements for ‘free’ tax filing services, then charging them when it’s time to file,” said Samuel Levine, Director of the Bureau of Consumer Protection, in a statement. “We’re asking a judge to put a stop to this bait-and-switch scheme and safeguard taxpayers throughout tax season.”
To read our blog on “Warren Dares Facebook With Intentionally False Political Ad”, click here.
