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TurboTax to pay $141M in agreement reached by all 50 states
- priyanmuthu 4y agoI guess TurboTax made much more money than 141M? A fine is fine only if it is higher than the profits.
- Eddy_Viscosity2 4y agoIndeed, when the fine is less then the profit, then its a kickback.
- frankfrankfrank 4y agoNot even that. Just consider how long it took for the government to make any kind of movement on the issue, regardless of whether it was some likely watered down toothless action or not. So, retroactively the cost was some fraction of $141M over the years they've gotten away with their practices and it is also safe to assume that they would likely just offset that cost over some period into the future, i.e., 10 years of past profit + 10 years until the mid point to the next government action, over $141M ... which they will make up by upping the price as they have clearly been doing on a regular basis. On that note. We should be telling everyone about freetaxusa.com (no affiliation other than having tried it). I can't recall the exact cost structure, but it's on the order of $25 to do federal and state returns with investment income, and file both electronically. That's in comparison to what I think is around $100 for the equivalent using TurboTax.
- idunno246 4y agoits also free under ~50k AGI, though it did keep trying to upsell me to the paid version, the free file program is pretty readily available from many providers. but they all do the type of thing that they just slapped intuit's wrists for and try to trick you into needing to pay when using free file, or trick you into your "free" taxes only being federal
- Buttons840 4y agoI second FreeTaxUSA. I used to use TurboTax and will get some of this settlement, and FreeTaxUSA is both better and more ethical.
- rsstack 4y agoFrom Google: Intuit has over $3B cash on hand. Market cap is 1000x the fine.
- chairmanwow1 4y ago$2.5M of the $141M is for “admin fees” ಠ_ಠ
- clintonc 4y ago$2.5M is a remarkably low percentage. If this means that 98% of the fine actually goes back to consumers, that's better than I've ever heard of from a class action lawsuit.
- electric_mayhem 4y agolol at 140 million going to consumers. That’s going to be like $1 per person per year they used the service
- s3p 4y agoPer the article, it's $30 per person per year.
- ezfe 4y agoIt's not everyone who used TurboTax, just people use use the Free Edition which is what this lawsuit is about.
- spiderice 4y agoNot sure I understand.. if they used the Free Edition, shouldn't they not have paid anything? I'm guessing that is the crux of the issue, but I guess I always assumed Turbo Tax got you started on the Free Edition then tried to upsell you. Sounds like they charge you money while keeping you on the Free Edition?
- ezfe 4y agoThe Free Edition doesn't support most use cases so it's not really free. According to the article, iirc, it supports less than a quarter of tax returns.
- throwawayboise 4y agoCan we please just solve the much bigger problem which is that ordinary people should not need to use any third party services to create, validate, and submit individual income tax returns. The IRS can and should be the provider of this software.
- ParksNet 4y agoOr just abandon Income Taxes (57% of US households don't pay any anyway) and embrace Land Value Taxes to fund State and Federal operations. Apply a credit for each child of the owner living in the dwelling to encourage house ownership.
- SOLAR_FIELDS 4y agoI mean, Texas essentially runs that way (minus the credit) and I wouldn't exactly call it a utopia here.
- throwawayboise 4y agoI'm not sure I like the idea of land value taxes though I concede there is a better argument that government expenses correlate better to land owned than to income.
- robertlagrant 4y agoI think the issue is less about expenses and more about what the populace will tolerate handing over. The one thing that's good about land value taxes is (perhaps) that they correlate more with wealth, so politicians who get rich from the state at least have to pay tax for their fancy houses.
- andykellr 4y agoWell Intuit has tried very hard to prevent that and so far has been successful. https://www.propublica.org/article/inside-turbotax-20-year-fight-to-stop-americans-from-filing-their-taxes-for-free https://www.propublica.org/article/inside-turbotax-20-year-f...
- 4y ago
- justinator 4y agoGood. They totally rigamarolled me at checkout.
- user3939382 4y ago“This agreement should serve as a reminder to companies large and small that engaging in these deceptive marketing ploys is illegal.” I think he meant profitable. From Intuit’s perspective this is like a court order to dump out the cup of coffee you bought. Forget the people who signed up from their ad, let’s add up the money the country has collectively spent (wasted) on CPAs, TurboTax, H&R Block, etc due to the complex income tax code Intuit and friends perpetually lobby to maintain. Intuit is a parasite on our society. Their newest strategy is to force businesses using QuickBooks into software subscriptions because we all know the logical rules for double entry bookkeeping are constantly in flux /s
- drummer 4y ago
- azinman2 4y agoYou cannot have a functional government without taxation.
- drummer 4y agoYes the mafia cannot exist without stealing. News at 11.
- azinman2 4y agoIt isn’t stealing to have a justice system, police, roads, schools, healthcare, trade, investment in things like the internet, a military, regulation around pharmaceuticals and foodstuffs, and a million other things that functional governments provide. Without the US government I literally wouldn’t be able to write this to you, both technologically as well as literacy-wise. There are plenty of failed governments out there where there effectively is none, and no taxation with a totally informal economy. I don’t see high immigration to any of these places.
- alar44 4y ago
- _bfhp 4y ago$1.41 parking ticket
- maerF0x0 4y agoHow is this company getting away with 50cents per person for defrauding a whole nation?
- ezfe 4y agoBecause this isn't about that, this is about their marketing of their TurboTax Free edition
- munk-a 4y agoThey are fraudulently advertising their product to the whole nation - it still comes out to 50c/head.
- geodel 4y agoHuh, whole media is chock full of fraudulent advertising including things that are not even marked as advertising. Now you can call it whataboutery but thankfully courts have to reasonably go with what they can prove and not like "whoa, you showed fraudulent ads, here is 128 billion dollar fine equal to your market cap today. Shutdown the company and pay by end of week."
- maerF0x0 4y agoI mean, no one suggested bankrupt the company -- but as other's have pointed out it remains _profitable_ to be fraudulent. Like at least fine them >= 100% of the value they gained.
- moate 4y agoHello. I would like to suggest bankrupting the company. It's not "fair" or "just" but it would be in the common good. Plenty of precedent for that from governments that give a fuck about the citizens and not the corporations. I realize this isn't actually going to happen, but I'd vote for the measure that involved the state seizing Intuit and raiding their software for the benefit of the IRS. (FWIW, I'm not going to respond to comments on this debating the merits of this non-plan. I get it's an unpopular opinion, especially on a tech-funding backed news board, so I don't need people to tell me why this is a "bad" choice and how it will slippery slope into whatever socialist hellscape personally keeps people up at night. Just wanted it out there that there are absolutely people willing to tear the whole fucking thing down because it's so broken).
- cosmiccatnap 4y ago141M would be like me having to pay 1000$ fine for robbing a federal bank where I stole $10 billion.
- s3p 4y agoWishing Intuit were fined out of existence, but a man can dream I guess.
- goldcd 4y agoI am not without complaints over my government (United Kingdom) - but they did manage to built an online tax system, without suddenly deciding that private companies would enhance the experience. By all means fine the bejeesus out of Intuit - but do not think for one moment the actual problem wasn't that they managed to lobby their way into that position. If anybody is interested, I quite like the UK government website - https://www.gov.uk/ https://www.gov.uk/ It has the appearance that it was knocked up in notepad, but after using it, I have a modicum of respect for how it makes government usable.
- jl6 4y agogov.uk is a breath of fresh air compared to the commercial swamp of the surface web. It’s a great example of design-is-how-it-works elevated above design-is-how-it-looks.
- d4mi3n 4y ago> It has the appearance that it was knocked up in notepad, but after using it, I have a modicum of respect for how it makes government usable. I'd wager that the looks have a lot to do with accessibility. Government sites are interesting in that to fill their purpose they're on the far end of the spectrum of website and system accessibility—in that they must be usable for: 1. People who don't have typical eyesight—colorblind, blind, vision with poor focus, issues distinguishing text without a sufficient level of contrast 2. People who don't use keyboards or mice to navigate—this could include folks using screen readers, voice assistants, or more exotic interface devices (think paraplegics using eye-tracking software or tongue switches). 3. People who are not neurotlypical and may struggle to use the website—think dyslexia, anxiety (info-dense walls of text can trigger panic attacks), or individuals who have trouble using computers or the internet. There's likely a lot more there than I'm personally aware of, but making even a basic service available and usable to a constituency can take a huge amount of effort. The UK gov website guidelines[1] touch on this and I applaud any government or organization that takes these things seriously. 1. https://www.gov.uk/guidance/accessibility-requirements-for-public-sector-websites-and-apps https://www.gov.uk/guidance/accessibility-requirements-for-p...
- 4y ago
- vijaybritto 4y agoMy only confusion in this ongoing saga is, how is there no open source free hosted solution for people to do this? Or are there any but they're not reliable/famous? I have worked at Intuit, Bangalore for a short time as a contractor and once during a weekly feature demo, a guy joked that "user shouldn't see the obvious way to cancel the payment". There was laughter around. It was a dark pattern but no one cared. They were boasting about being one of the best places to work all the time. But it was hell. They simply don't give contractors a place to sit and work. You're called 'Mobile'. So you get to sit only where the full time employees don't sit or when they are on leave. It was humiliating and i simply don't understand why they have that as a policy. The manager was talking as if he moved mountains for us a couple of contractors to sit. But it was actually a couple of desks where there was direct sun light and no full time employees would sit because it's so hot and you get sweaty in minutes. I left in a couple of months and didn't even say good bye.
- uncletaco 4y agoThere is: GNUcash, ledger, and beancount.
- leeoniya 4y agothis was shared recently https://github.com/ustaxes/UsTaxes https://github.com/ustaxes/UsTaxes
- throwawayboise 4y agoI tried using it; it's very limited. It might work for you if you have W2 income and nothing else.
- geodel 4y agoWell, State and fed tax can be filed free and all the forms are available online or even free printed copies in public libraries.
- gigatexal 4y agoPay 141M and change nothing hmm
- tynpeddler 4y agoThis is the important part of the article: > Consumers are expected to receive a direct payment of approximately $30 for each year that they were deceived into paying for filing services. Impacted consumers will automatically receive notices and a check by mail. It looks like TurboTax is being required to return the money they fraudulently obtained, but they're not even required to pay interest or any additional restitution or punitive damages. It's definitely disappointing and a minor miscarriage of justice. Edit: Two things I want to clarify from my original comment. First, I wasn't able to find pricing info from the years in question so I went from what I remembered as their lowest pricing tier which I think was $30. Second, I use the term "minor miscarriage of justice" as a comparison to the Sackler BS which was a gross (as in disgusting) miscarriage of justice.
- thomascgalvin 4y agoIt's better than a coupon for free tax preparation next year, which is sort of what I expected.
- the_only_law 4y agoGiven the recent trend of incompetence leading into borderline scams I don’t blame you.
- dr_orpheus 4y agoTrue, I feel like coupons are a way that a lot of these go. I remember my $14 Ticketmaster coupon (or something I don't remember the exact amount) that had an expiration date on it. Some of the class action suits also require you to be the one to put in effort to receive your money, so the fact that TurboTax is just mailing everyone a check seems better than others. And "better" doesn't necessarily mean "good". Still not a fan of TurboTax or the US tax filing system.
- rgbrenner 4y agoIs that a full refund? The cheapest Turbotax product is $60 + 50 for state.
- cwal37 4y agoA lot of people here asking "Why is the fine so low, how does this happen!" I recommend reading "The Chickenshit Club: Why the Justice Department Fails to Prosecute Executives"[0] which is obviously a bit broader than just fines, but does touch on the history and current state of things with respect to corporate malfeasance. One thing that I did not know (too young to be paying close enough attention at the time), but was interesting to me was the backlash from Arthur Andersen collapsing and the resulting loss of jobs as part of the whole Enron scandal. This was at least somewhat blamed on government overreach in going after Enron, even if that wasn't exactly the case, and helped to set the table for quite a slide in standards over time. [0]https://www.npr.org/2017/07/30/535799735/corporate-bungling-and-political-scandal-abound-in-jesse-eisinger-s-new-book https://www.npr.org/2017/07/30/535799735/corporate-bungling-...
- alx__ 4y agoSo the fed doesn't want to be to harsh and risk destabilizing the economy? Then by doing this, encourages companies to engage in shitty behavior. Which could then destabilize the economy when they implode. Capitalism™: Shut up, it tastes good!? [Yeah I'm being reductive, just annoyed to watch all this and feel helpless that nothing changes]
- moate 4y agoRight, but when large "needed" industries fail and destabilize things, they just get bailed out. In the end, it all works out for the investor class.
- vmception 4y agoCan we do the same to Dunn & Bradstreet DUNS number? This is free as well, required for business credit score creation and reporting, federal contracting, and oddly for posting an app on the Apple App Store. But they have an insane number of anti-patterns to get you to pay for it and other products in the way.
- kelvin0 4y agoPhase 2: Get get rid of the Income Tax itself ...
- ineptech 4y ago> New York Will Receive Over $5.4 Million for More Than 176,000 New Yorkers That's $30 each for users who are already onboarded and very likely to use this high-margin product again next year. As customer acquisition strategies go, "outright fraud" is looking pretty good!
- JoeAltmaier 4y agoI'd prefer the IRS provide a truly free website. Screw Intuit, they broke the agreement.
- Vladimof 4y agoHow about the IRS send us a filled out tax return instead... and we can amend it.
- mkaic 4y agoFor real. This is how the system ought to work. If they have the resources to come after you if you accidentally filled something out wrong, they have the resources to fill it out right for you in the first place. The tax system in the USA is nothing short of a farce.
- throwawayboise 4y agoTo be fair, the IRS does not "come after you" if you make a mistake. They send you a letter, with request for the additional amount due, and if you agree, you pay it. Done.
- Vladimof 4y agoI think that the IRS is hoping that people make mistakes in their favor... I.E.: Anyone ever got a letter from the IRS saying that they paid too much?
- ars 4y agoHappens all the time. I got one from a State once, and I'm still convinced I was right and they were wrong, I'm not exactly going to argue with them, when they're sending me money. However if you report more interest, or wages than they know about they will take your numbers as is - they assume you are reporting under the table income. They will however fix arithmetic errors, and give you credit for things you should have asked for (dependent deductions for example).
- 4y ago
- naikrovek 4y agoSo, basically no fine at all. This is nothing to a company that size. Nothing.
- deleted 4y ago[deleted]
- not2b 4y agoThey made $2 billion in profit in 2021, so this is about 7% of that.
- rootusrootus 4y agoHow about instead of fining them, we just create a free tax filing website at the IRS to spite them? $141MM is just the cost of doing business, and that's ridiculous.
- moate 4y agoBecause the IRS tied their own hands when they agreed not to compete. You'd need to find political will to change that and "how you file your taxes" isn't a sexy issue that gets voters to give a fuck.
- rexpop 4y ago> they agreed not to compete Apparently, as of 2019, this is no longer the case.[0] 0. https://www.propublica.org/article/irs-reforms-free-file-program-drops-agreement-not-to-compete-with-turbotax https://www.propublica.org/article/irs-reforms-free-file-pro...
- moate 4y agoRe-reading the original comment, I misunderstood their verb tense. I took it as "why hadn't we just done this ourselves" and was pointing out the historic glad-handing. You are correct that in response to the issue, the IRS cut out the sweetheart deal they'd given the industry originally.
- goatcode 4y agoThe IRS went 3 months past promised deadline on their withholdings estimator site. I can't imagine the folly that'd be produced by them attempting tax software, as wrong as that sounds.
- countvonbalzac 4y agoBecause they're ridiculously underfunded. Half of the conservative movement is based around trying to starve the IRS to death so that de facto taxes for wealthy people don't exist anymore.
- vjeux 4y ago> In contrast, the IRS Free File products were free for 70 percent of taxpayers. I wonder why the IRS "Free" version isn't actually free!
- deleted 4y ago[deleted]
- musicale 4y agoIs the IRS under any obligation to provide e-filing systems access to companies like Intuit that knowingly flout the law? If not, they should revoke it.
- beej71 4y agoIT'S STILL ALIVE! FINE IT AGAIN! FINE IT AGAIN!
- Layke1123 4y agoI found this comment to be quite humorous. I really appreciate comments like this from time to time.
- aaaaaaaaata 4y agoThere's this new place called reddit
- Layke1123 4y agoReddit is older than Hacker News?
- Mikeb85 4y agoNice. About half of the process of filing taxes with TurboTax is dodging all the dark patterns to try get you to pay...
- 1970-01-01 4y ago>Intuit will pay $141 million in restitution, of which roughly $2.5 million will be used for administrative fund costs. A total joke. It would be better to hold a $141,000,000 lottery instead of giving out $30/house.
- beambot 4y agoAll the best facets of capitalism at play: regulatory capture, decentralized costs & concentrated profits, and fees small enough to be a cost of business rather than long-term deterrent.
- robertlagrant 4y agoWell, the best facet is you can choose to use their competitor. Most of your list are more about government than the company.
- user- 4y agoIm Canadian. I filed my taxes using WealthSimple Tax. It cost $0. It took <5 minutes. I really don't understand why people pay for TurboTax.
- Layke1123 4y agoBecause most people are not in Canada? At least who use this website I'm guessing? Or does WealthSimple Tax also do American taxes? Also, the signal to noise ratio. This is the first I've ever heard of this company, and I usually am light years ahead of the "normal" person because I peruse sites like this constantly.
- AtomicOrbital 4y agoI used Intuit online for about 10 years... at the beginning it was fantastic however year over year it just became worse until I had to abandon them and use a different online tax service... My returns are very straightforward and I did my own on paper prior to Intuit... I can only say Intuit seems to have intentionally made the flow of questions unwieldy over the years... almost as if they intentionally sabotaged their own business... so sad
- monster2control 4y ago141 million, is a minor footnote in their profits.
- pzone 4y agoThe Federal Government should simply buy TurboTax from Intuit and make it a free service