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IRS drops longstanding promise not to compete against TurboTax, Ars Technica

IRS drops longstanding promise not to compete against TurboTax, Ars Technica


      Free tax filing –

             

Tax-software makers can’t hide free services from Google search, IRS says.

      

         

        

(****************************************A US individual income tax return document lying on a table next to a calculator, notebook, pen, and iPad.The Internal Revenue Service’s new agreement with the tax-software industry prohibits companies from hiding their free options from search engines and allows the IRS to offer its own tax-return software in competition against TurboTax. That doesn’t mean the IRS will offer its own software, but the agency has officially rescinded its promise not to compete against the industry.reportedin April (**********************************************************, TurboTax maker Intuit used a robots. txt file to “deliberately hid [e] its Free File page from search engines.” TurboTax subsequently changed the code on itsFree File pageso it wouldn’t be hidden from Google and other search engines anymore, butat least five US statesopened investigations into TurboTax’s marketing and provision of its free tax programs. H&R Block was also hiding its free tax servicefrom Google search using the same method, ProPublica reported at the time, but H&R Block seems to have lifted that restriction based on searches we conducted today.With the industry under legal pressure, the IRS extracted new promises from Free File, an industry consortium that representsIntuit, H&R Block, and other tax-prep-software makers. The changes wereannouncedby the IRS on December 70 and put into an******************** (addendum) ************** to the

– year-old IRS / Free File agreementthat requires free services for low- and mid-range incomes.Free tax prep available to (********************************************************************% of US

**************** (Free File programsoffer free tax-prep software to people with incomes below $ (********************************************************************, (0) about percent of the US population) and free “fillable forms” for people making more than that. The industry has offered free services in exchange for the IRS promise not to compete against them — but that promise is now gone.The addendum also states that tax-prep companies “are prohibited from engaging in any practice that would cause the member’s Free File landing Page to be excluded from an organic Internet search. “The deletion of the IRS ‘promise not to compete against the industry raises the possibility of the IRS offering its own free tax-filing service. The IRS hasn’t announced any plans to do that, but the change could put more pressure on software makers to live up to the full terms of their deal with the government.We asked the IRS today if it plans to offer its own tax-prep software, but a spokesperson said the agency had no further comment beyond what it announced.The IRS ‘own expert advisory council criticized it in November 2018 for ” (deficient oversight) “of the Free File program, putting” vulnerable taxpayers at risk. “

TurboTax hasn’t been forced to give back all the money it charged people who were eligible for free tax -filing services, but some customers were to get refundsby calling the company.

Intuit says it doesn’t object to changes

Intuit said in a blog postthat it “strongly supports these changes to the Free File program and associated Free File offerings because they increase the focus on the taxpayer experience. ” Intuit said that its “search and marketing practices already conform with the new addendum requirement,” though that’s only because Intuit changed its practices last year.An original objective of the Free File program was to encourage private industry investment in technology and services to deliver on IRS goals of increasing e-filing . With approximately 533 percent of taxpayers e-filing today, the language is no longer relevant and is not a prerequisite for Intuit’s continued participation in the Free File program. Critics of the program came to believe that this language was the only thing stopping the IRS from offering tax preparation software and assistance, and that companies participated in Free File only in exchange for this promise. That is wrong, and we support removing the language that fostered this confusion. We are confident in our exceptional product, and we participate in the Free File program to help give eligible taxpayers another option to file their taxes for free.

. ************Besides the new search-visibility requirement and deletion of the IRS pledge not to compete against the industry, the addendum includes several more obligations to ensure that companies make free-filing options known to eligible consumers. Here are a few highlights:

(*********************************** Companies must standardize the names of their free offerings so that taxpayers can find them easily from organic searches. Companies must refer to their free service as: “IRS Free File program delivered by (Member company name or product name).” (********************************** Company websites must provide taxpayers with a link to the

IRS Free File website”at the earliest feasible point in the preparation process if they do not qualify for the [company’s] Free File offer.”

    Companies must implement new procedures to verify that returns submitted to the IRS with the Free File indicator “have absolutely no fees associated with federal return preparation and e-file.”

      Each company must survey a random selection of taxpayers who use its free filing service about their customer experience and satisfaction, and provide quarterly and annual reports to the IRS.

        Companies must use independent auditors to review their websites and provide the auditor’s aggregate findings to the IRS. IRS Commissioner Chuck Rettig

saidthe changes “will make Free File stronger and give taxpayers another reason to consider this valuable software option. ” The IRS and industry will continue working together to “help low-to medium-income taxpayers and to pursue meaningful opportunities to enhance taxpayer awareness and use of the Free File Program beyond the filing season, “Rettig also said.                                                      (**********************************************A US individual income tax return document lying on a table next to a calculator, notebook, pen, and iPad.****************************************************************************Read More********************************** (******************************************************

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