TurboTax-Maker Intuit Will Leave Free Tax Filing Partnership With IRS – By Justin Elliott and Paul Kiel (ProPublica) / July 16 2021
The company’s decision throws the future of the Free File program, which was created as an alternative to an IRS free tax filing system, into doubt.
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TurboTax maker Intuit, the largest company in the tax-preparation software industry, announced Thursday that it will leave the Free File program, the public-private partnership that offers free tax filing to millions of Americans but has been a magnet for controversy since its creation two decades ago.
The program was founded as a gambit by the tax prep industry, led by Intuit, after the George W. Bush administration proposed that the IRS create a free online filing option for taxpayers. Such an option would have threatened the profits of the burgeoning tax prep software business. After lobbying by the companies, the IRS agreed not to develop its own filing portal. In exchange, the industry offered free versions of its software, including TurboTax, to most Americans.
The exit of Free File’s two largest participants — Intuit, and, last year, H&R Block — throws the future of the program into doubt. The Free File Alliance, the industry group that administers the program with the IRS, did not immediately respond to a question about the viability of the program after Intuit’s departure, but said, “We appreciate [Intuit’s] service in providing millions of free returns to American taxpayers.”
