Intuit, the parent company of tax filing software TurboTax, is exiting an IRS program that allows many Americans to file their taxes for free. The IRS partners with the Free File Alliance, a nonprofit coalition of tax software companies that offer no-cost tax filing services for the Free File program. Intuit says in a blog post on its website that part of the reason it’s leaving Free File— which is available to 2020 filers with adjusted gross income of $72,000 or less— is the “restraints” of the program.
“With the Free File program surpassing its founding goals of e-file and free tax preparation, and due to the limitations of the Free File program and conflicting demands from those outside the program, we are not able to continue in the program and deliver all of the benefits that can help consumers make more money, save more, and invest for the future,” according to the blog post.
Readers may recall that a series of reports by ProPublica found that Intuit and H&R Block had misled filers into paying to file their taxes. The companies kept the free versions of their software from showing up in search engine results, according to ProPublica, making them harder to find online. The IRS later overhauled the Free File program, removing a provision in the agreement that prohibited the agency from creating an online filing system of its own that would compete with the software companies’ products.
Intuit’s blog post says the company will leave the Free File program at the end of the tax season in October because it wants to “provide more financial benefits and empower Americans of all income levels to take control of their finances.”
Intuit closed on an acquisition of credit score monitoring company Credit Karma for $7.1 billion in December 2020. The deal drew scrutiny from the Department of Justice, which was concerned about potential antitrust issues; Credit Karma started offering its own version of free tax filing in 2017.
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