Taxes

FTC Probes Intuit Over Alleged Deceptive TurboTax Marketing

The Federal Trade Commission (FTC) is looking into Intuit over its TurboTax product, as the company allegedly was tricking customers into paying for what they could've gotten for free, according to a ProPublica report.

The investigation will look into whether Intuit engaged in deceptive or misdirecting practices when it marketed TurboTax's paid products to people eligible to file their taxes for free. The investigation has been going on for more than a year, and it was revealed in a company filing when lawyers tried to appeal to limit the scope of the investigation.

According to ProPublica's reporting on the case from last year, TurboTax marketing used a variety of tactics to push TurboTax's paid service, burying free services and often advertising services as free before revealing the costs after numerous clicks. That came after the IRS agreed not to make its own free tax tool when Intuit and other similar companies agreed to provide their own.

Intuit provided 500,000 pages of documents responding to the FTC's first civil investigative demand last year, but it has been after the FTC to narrow the scope. In May, FTC investigators passed down another civil demand. Intuit has pleaded that the pandemic makes the requests "incredibly burdensome," according to ProPublica.

But in a bipartisan order from the commission, the company's requests were denied. The investigation will continue as broadly as it had been.

Intuit also faced scrutiny from the Department of Justice in August over its acquisition of Credit Karma for $7.1 billion. The issue in that case was antitrust. If Intuit owns both Credit Karma and TurboTax, critics worry that there could be an encroaching lack of competition in the field.

Last year, Intuit denied that there had been a data breach at TurboTax in which a third-party scammer was able to acquire user information, saying instead that the breach in question happened outside of its websites.

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