Sen. Warren Demands Answers From Intuit About Its ‘Shady Practices’

On Monday, Tax Day 2022, United States Senator Elizabeth Warren (D-Mass.), a member of the Senate Finance Committee, and Representatives Brad Sherman (D-Calif.) and Katie Porter (D-Calif.), sent a letter to Intuit, the maker of TurboTax, calling out what the lawmakers say are the company’s “unethical use of the revolving door to hire former regulators to defend its shady business practices that scam taxpayers out of billions of dollars.”

Their letter follows a Federal Trade Commission (FTC) complaint against Intuit for deceiving millions of taxpayers with “bogus” advertising for free tax filing, which also revealed that Intuit hired former FTC Commissioner Jon Liebowitz as an outside counsel.

Given these revelations and Intuit’s history of using lobbyists to oppose consumer protections and protect the Free File program that has scammed billions from taxpayers, the lawmakers are demanding answers from Intuit about its abuse of the revolving door.

“Intuit has gotten away with these Free File scams thanks to extensive lobbying and adroit influence-peddling – including repeated use of revolving door hires. Intuit’s lobbying program topped $3.2 million in 2021, focusing on opposing automatic filing that would expand free tax preparation services and putting up roadblocks for any proposed consumer protections. And Intuit has frequently deployed former regulators as lobbyists… Intuit has shown time and time again that it will not stop its “free” filing scams. That is why we have championed commonsense tax filing simplification reforms, and introduced legislation to close the revolving door that protects corporate scams like Free File,” wrote the lawmakers.

In 2003, Intuit and other financial services companies lobbied the Internal Revenue Service (IRS) to create the Free File program, which would provide free tax preparation services to low-and middle-income taxpayers through these private companies. The program was supposed to cover 70% of American taxpayers, but as of 2018, only 3% of taxpayers participated.

The lawmakers say the severe underutilization of Free File was driven by deceptive practices and sabotage from Free File companies – Intuit deliberately hid Free File from Google results, repeatedly changed names and landing pages to confuse and deceive consumers, and targeted military service members, people with disabilities, unemployed Americans, and people with student loans with upselling scams. While Intuit left the Free File program in 2021, the IRS has still not set up a government-run alternative.

To prevent companies like Intuit from continuing “free” filing scams, save taxpayers billions of dollars, and close the corrupt revolving door between government regulators and giant corporations, the lawmakers are calling for passage of their Tax Filing and Simplification Act, which they will be reintroducing soon.

The legislation would protect taxpayers from corporate profiteering by directing the IRS to create simplified tax filing tools, a truly free replacement to the Free File Program, and give millions of taxpayers the option to avoid tax preparation entirely by providing them with a pre-filed tax return.


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