FTC sues Intuit in bid to stop “deceptive” ads that claim TurboTax is free

Enlarge / TurboTax products sit on display at Costco on January 28, 2016, in Foster City, California. (credit: Getty Images | Kimberly White )

The Federal Trade Commission sued Intuit on Monday, alleging that it deceptively advertises "free" tax filing with TurboTax. Intuit's deceptive tactics pushed customers toward paid products-even in cases where they were eligible for the no-cost Free File program for people with low and moderate incomes, the FTC said.

The FTC asked a judge to issue a temporary restraining order and preliminary injunction forcing Intuit to stop "disseminating the deceptive claim that consumers can file their taxes for free using TurboTax when in truth, in numerous instances Defendant does not permit consumers to file their taxes for free using TurboTax." If approved by the court, a proposed order submitted by the FTC would force Intuit to either stop claiming its product is free or to conspicuously include all the limitations in ads "so as to leave no reasonable probability that the terms of the offer might be misunderstood."

The FTC said Intuit makes misleading claims about TurboTax in paid advertisements and on its website. "Much of Intuit's advertising for TurboTax conveys the message that consumers can file their taxes for free using TurboTax, even going so far as to air commercials in which almost every word spoken is the word 'free,'" the FTC said in its complaint filed in US District Court for the Northern District of California. Intuit said it will fight the lawsuit in a response that called the FTC's allegations inaccurate.

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