Chicago – Attorney General Kwame Raoul today announced Illinois consumers deceived into paying for tax services that were available for free will soon begin receiving settlement checks from a nationwide multistate settlement with TurboTax owner Intuit Inc. (Intuit).
Under the bipartisan settlement announced in May 2022, Intuit will pay $141 million as restitution to millions of Americans, including more than $4.38 million to more than 143,000 affected Illinoisans. Eligible consumers will be contacted by email, and checks will be mailed throughout the month of May.
“Intuit deceived customers into paying for their products while attempting to diminish free tax services available through the federal government,” Raoul said. “I am pleased that consumers will start to receive checks under the settlement, which holds Intuit accountable for intentionally deceiving taxpayers simply to increase sales of their products.”
Eligible consumers include those who paid to file their federal tax returns through TurboTax for tax years 2016, 2017 and 2018 but were eligible to file for free through the IRS Free File Program. Consumers who are eligible for a payment will be notified by email by the settlement fund administrator, Rust Consulting. These consumers will receive a check in the mail automatically without having to file a claim. Checks are expected to be mailed out starting the week of May 8, 2023.
The amount each consumer receives will be based on the number of tax years for which they qualify for a payment. Most consumers are expected to receive between $29 and $30. For more information about who is covered by the settlement, and information about the settlement fund, please visit www.AGTurboTaxSettlement.com.
States opened an investigation into Intuit following reports that the company was using deceptive digital tactics to steer low-income consumers toward its commercial products and away from federally-supported free tax services.
The states’ investigation found that Intuit engaged in several deceptive and unfair trade practices that limited consumers’ participation in the IRS Free File Program. The company used confusingly similar names for both its IRS Free File product and its commercial “freemium” product. Intuit bid on paid search advertisements to direct consumers who were looking for the IRS Free File product to the TurboTax “freemium” product instead. Intuit also purposefully blocked its IRS Free File landing page from search engine results during the 2019 tax filing season, effectively preventing eligible taxpayers from filing their taxes for free through Intuit. Moreover, TurboTax’s website included a “products and pricing” page that stated it would “recommend the right tax solution.” However, the page never displayed or recommended the IRS Free File program, even when consumers were ineligible for the “freemium” product.
