TurboTax’s parent company, Intuit, was sued by all 50 states in 2022 for steering low-income Americans away from free tax-filing services in favor of using its paid filing platform. This ultimately led to a $141 million settlement for more than 4.4 million Americans across the country.
Now, consumers involved in the lawsuit should prepare to see their settlement checks in the mail in the coming weeks.
“TurboTax’s predatory and deceptive marketing cheated millions of low-income Americans who were trying to fulfill their legal duties to file their taxes,” New York State Attorney General Letitia James said in a statement. “Today we are righting that wrong and putting money back into the pockets of hardworking taxpayers who should have never paid to file their taxes. I thank my fellow attorneys general for their partnership in this effort to stand up for ordinary Americans and hold companies who cheat consumers accountable.”
Who is eligible for the settlement?
Who will be receiving the settlement from TurboTax and Intuit? According to the official settlement website, there are two main groups that will be receiving payouts:
Anyone who paid Intuit to file their federal taxes through TurboTax for tax years 2016, 2017, or 2018, but was eligible to participate in the IRS’ Free File program.
Those who were eligible to use a TurboTax Free Edition Product, but were then informed they were ineligible to use such products, and ultimately utilized a TurboTax paid product to file their taxes, and also hadn’t used the Intuit Free File Product in a previous year.
The amount consumers will receive from the settlement ultimately comes down to how many years they utilized TurboTax’s services while also being eligible for Free File. While most consumers are expected to receive around $30 from the settlement, those who utilized these products for all three tax years could end up with around $85.
Those receiving payouts will hear from Rust Consulting, the third-party company handling the settlement, by email. The email will contain details on how much your portion of the settlement will be, and no further action will be necessary. All payments will be made via check and sent in the mail throughout the month.
The settlement agency encourages consumers to be patient with receiving their checks. If they haven’t received anything by mid-June, they can request to have their payment re-issued and will need to provide their claimant ID number from their original email.