(NewsReady.com) – Intuit Inc. has long advertised Turbo Tax as a free tool for people to use to file their taxes. For many people, that was not the case. Now, the Federal Trade Commission (FTC) is cracking down on the company.
On January 22, the FTC released an opinion stating that Intuit has “engaged in deceptive advertising” by running ads telling consumers it has free tax services, but in reality, many customers are not eligible. The federal agency ordered the company to stop “claiming a product or service is free unless it’s free for all.” If the product is not free for everyone, the company must clearly state who qualifies.
The order states that if TurboTax’s advertisement space is limited and all of the terms and conditions cannot fit in the space, that is okay. However, the company must include language that lets people know that a majority of consumers will not qualify for the free services, if that is the case. The FTC has also prohibited Intuit from making false claims about its services and products, including a consumer’s ability to claim tax credits without having to buy the paid TurboTax service, and about its refund policies.
The federal agency’s order stems from a 2022 FTC lawsuit against Intuit. The agency accused the company of “deceiving consumers with bogus advertisements.” While it claims to offer a free filing service, that isn’t available to people who receive 1099 forms. Approximately two-thirds of tax filers were not able to use the free product in 2020.
Intuit intends to immediately appeal the decision. Reuters reported the company issued a statement saying it believes it would “prevail” when the issue “returns to a neutral body.” The company also said it doesn’t expect a significant impact on business because the FTC didn’t issue a fine.
Still, the FTC’s decision comes as tax season gets underway, and millions of Americans are searching for reliable filing programs. To that end, the IRS offers free filing online to some taxpayers.
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