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The Federal Trade Commission says the company behind the popular tax filing software TurboTax engaged in "deceptive advertising" when it ran ads for free tax services that many customers were ineligible for.

 Monday to stop advertising any free products and services unless they're free for all consumers, or unless the company discloses on the ad the percentage of people who would be eligible for the unpaid offerings.

Samuel Levine, director of the FTC's Bureau of Consumer Protection, 

 the vast majority of Intuit's customers couldn't take advantage of what the company claimed it was providing at no charge. 

"Instead, they were upgraded into costly deluxe and premium products," Levine said in a statement. "As the Commission has long understood, 'free' is a powerful lure, one that Intuit deployed in scores of ads. Its attempts to qualify its 'free' claim were ineffective and often inconspicuous."

 by an administrative law judge in September, which found that Intuit engaged in deceptive marketing that violated 

Intuit spokesperson Derrick L. Plummer called the

opinion "deeply flawed" and said the company was appealing it in federal court.

"This decision is the result of a biased and broken system where the Commission serves as accuser, judge, jury, and then appellate judge all in the same case," Plummer said in a statement.

The FTC first sued Intuit in March 2022 over the ads pitching free TurboTax products. The commission 

 about two-thirds of tax filers in 2020 would have been ineligible for the company's free offerings, such as freelance workers who received 1099 forms and people who earned farm income.

 to pay $141 million to customers across the U.S. as part of a settlement with the attorneys general of all 50 states over similar complaints related to its purportedly free tax-filing services. The company did not accept any wrongdoing. 

New York Attorney General Letitia James, who led the multistate investigation alongside Tennessee Attorney General Herbert H. Slatery III, said she opened an inquiry into the company after reading a 2019 

 that found Intuit had for years tried to stop any efforts to make it easier for Americans to file their taxes. 

 more than 124 million Americans file their taxes for free over the last decade, and 

 that the FTC's action against the company is unnecessary because the core issues were settled in the agreement with the state attorneys general.  

Business and Economic News

Joe Hernandez

Author

Regulators say the company advertised "free" tax filing products and services that many Americans were ineligible for. Intuit called the opinion "deeply flawed."

The FTC bars TurboTax maker Intuit from advertising 'deceptive' free services

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