Over $400,000 will be reimbursed to Delawareans who were swindled by TurboTax.
Attorney General Kathy Jennings secured the funding Thursday as part of a nationwide settlement with the owner of TurboTax, Intuit Inc. The company will pay out a total of $141 million to consumers across the country for the scam.
Free tax services were advertised through TurboTax, but customers for tax years 2016-2018 reported sudden charges when it came time to file.
Jennings described Intuit’s tactics as deceptive and unfair to low-income Delawareans. A multi-state investigation also described their marketing as “aggressive” – repeating the word “free” dozens of times within a 30 second ad.
There are two free versions of TurboTax – one through the IRS Free File Program for members of the military and taxpayers earning roughly $34,000 or less – and one for taxpayers with simple returns, which Intuit defines as only a 1040.
The investigation also determined that Intuit used confusingly similar names for both its IRS Free File product and its commercial “freemium” product.
Those eligible come out to only one-third of US taxpayers.
Per the settlement, Intuit has also agreed to reform its business practices and be transparent in its advertising and marketing.