Minnesotans will share in $1.8M in refunds from TurboTax settlement
The settlement agreement calls for refunds to customers who paid fees to use the free version of TurboTax for tax years 2016 through 2018.
ST. PAUL — Minnesotans will share in up to $1.8 million in refunds as the result of a legal settlement with the maker of tax filing software TurboTax, state Attorney General Keith Ellison announced Thursday, May 5.
As many as 60,000 state residents will be eligible for the refunds after software maker Intuit Inc. falsely advertised its software as free, Ellison's office said in a news release. As part of a $141 million settlement agreement with all 50 states and Washington, D.C., the company must pay restitution to millions of customers and cease misleading advertising.
“Part of my job of helping Minnesotans afford their lives is protecting them from predatory corporations. I joined this investigation and settlement because Intuit’s business practices defrauded Minnesotans," Ellison said in his release. "The settlement we’ve reached will put money back in the pockets of low-income consumers that Intuit deceived into paying for tax-preparation services that should have been free.”
Intuit had a long-standing partnership with the Internal Revenue Service where it was required to provide a free tax filing program for low-income filers, according to Ellison's office. Under the agreement, the IRS said it would not create a free program of its own and compete with Intuit or other tax service providers.
It turned out the software "TurboTax Free Edition" was free to only about one-third of U.S. customers, and did not adequately disclose this, the release said.
The settlement agreement calls for customers who used the free version of TurboTax for tax years 2016 through 2018. Users charged fees despite being told the service was free will receive approximately $30 each year they filed and paid fees. Eligible Minnesotans will get at least a partial refund. Impacted customers will get notification of the refund and a check by mail.
As part of the settlement, Intuit must also end its "free free free" advertising campaign and be more transparent about any charges that may occur while using its software.