Consumers to receive checks in the mail from multistate settlement without needing to file a claim
OAKLAND–California Attorney General Rob Bontatoday announced that consumers who were tricked by TurboTax’s owner Intuit into paying for free tax services will begin receiving checks from a $141 million multistate settlement announced in May 2022. Approximately 4.4 million consumers nationwide will receive checks in the mail from themultistate settlement. Californianswill receive more than $12.2 million,distributed to themore than 400,000 consumers who wereeligiblefor a free tax filing program and were insteaddeceivedinto payingto file their federal tax return. Eligible consumers will be contacted by email about the settlement, with checks expected to be mailed out starting next week.
“Whenhuge companieslike Intuit take advantage offederalprogramsto deceive consumers into paying for something they are entitled to get for free, they doso on the backs ofhardworking Californians,”said Attorney General Bonta. “This month, hundreds ofthousands of Californians willbegin receiving rightful restitution for Intuit’s wrongdoings.”
In 2022, Attorney General Bonta, as part of a coalition of 51 attorneys general and with the Los Angeles City Attorney and Santa Clara County Counsel, announced a $141 million settlement against Intuit, resolving allegations that the California-based company deceptively advertised its “free” online TurboTax products. Although 70% of taxpayers qualify for the Internal Revenue Service (IRS) Free File Program, operated by Intuit and others, less than 3% of taxpayers used it to file their returns in 2020. This abysmal rate is due, at least in part, to tricks and tactics used by Intuit to steer taxpayers away from the IRS Free File Program and to its paid commercial products.
Eligible consumers include those who paid to file their federal tax returns through TurboTax for tax years 2016, 2017, and 2018 and 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 filing a claim. The amount each consumer receives will be based on the number of tax years for which they qualify. Most consumers are expected to receive between $29 and $30.
Protect Yourself from Tax Filing ServiceScams
- Find a trusted tax preparer:To confirm whether your tax preparer is registered with the IRS, checkhere. Visit theBetter Business Bureauand other review sites to compare consumer reviews and complaints. To make a complaint with the IRS about a tax preparer, clickhere.
- Compare services and prices:Compare the prices of different tax preparation services before you choose one, and check for any hidden fees.
- File your own taxes:Depending on your income, you may be eligible to file your taxes using guided tax preparation software at no cost. Clickhereto e-file your state tax return directly to the California Franchise Tax Board for free. Additionally, clickherefor a list of IRS Free File partners.
- Never sign a blank return:Do not use a tax preparer who asks you to sign a blank tax form.
- Talk to friends and family:Always seek a second opinion from your friends and family.
For more information about who is covered by the settlement, and information about the settlement fund, please visitwww.AGTurboTaxSettlement.com.
