Indiana to get $2.9M in settlement over `free' TurboTax ads

Indiana statehouse
Posted at 2:15 PM, Jun 17, 2022

INDIANAPOLIS (AP) — Indiana will get $2.9 million from a nationwide settlement with a software company that misled users who filed their taxes through TurboTax.

Intuit Inc., the California-based company behind the TurboTax tax-filing program, advertised TurboTax as completely free, but this only held true for taxpayers filing basic returns, the Indiana attorney general’s office said.

Those filing a more detailed return were notified that they must upgrade to a paid service after providing additional information. Intuit also did not notify low-income users they qualified for a genuinely free product through the Internal Revenue Service provided through TurboTax, regardless of their filing status, the attorney general's office said Thursday in a news release.

Indiana's share is part of a $141 million settlement across 50 states and the District of Columbia. Before last year, Intuit offered two free versions of TurboTax — the IRS’s Free File Program for those making under $34,000 and members of the military and the “TurboTax Free Edition” for taxpayers with “simple returns. A ProPublica investigation exposed how Intuit executives were aware they deceived customers in advertising the service.

Approximately 4 million people across the United States were impacted, including more than 98,000 Indiana residents. Those who used TurboTax for tax years 2016 through 2018 are eligible for approximately $30 payments for each year that they paid to file.