Intuit backtracks on new TurboTax fees

In response to a customer revolt on the Internet, Intuit has decided to eliminate fees it introduced with TurboTax 2008 that would charge users for preparing multiple returns.

The maker of the popular tax-preparation program announced Thursday that it would drop the $9.95 fee it introduced with this year's release, while still maintaining free e-filing for its customers.

(Credit: Intuit)

"We're responding to changing market conditions and customer feedback," Dan Maurer, general manager of Intuit's consumer division, said in a statement. "We believe this better positions TurboTax in the marketplace with an even stronger value proposition for consumers."

The reversal comes as the software maker grappled with an Internet protest from longtime customers that included an overwhelmingly subpar rating by Amazon.com reviewers, as well as a bevy of negative comments on Intuit's own user message boards. Many users, who said they also prepare returns for elderly parents and young children, complained that the new fees would double the cost of using the software compared with last year.

Many Amazon reviewers used the online retailer's feedback section to vent their frustration, with some users calling the new fees a "scam" and "unjustifiable and unsubstantiated."

The avalanche of outrage is reminiscent of the well-publicized and coordinated user revolt against the digital rights management restrictions on Electronic Arts' game Spore, which resulted in more than 2,000 one-star ratings being left on the game's Amazon page.

Company representatives defended the new charges to me a few days ago, saying that users would actually save money because e-filing was included in this year's version.

Many readers responded that they were so upset by the new fee that they would not be purchasing the product this year, but it's unclear whether this reversal will lure back users who defected.

[GlennW007]

There's no reason to charge an extra $10 for a family member's return. TuroTax gets enough in fees with the high purchase price and Efile charges. Did you know the IRS lets you file free, or use a stamp if paying tax.

Hi GlennW007...Julie from TurboTax here. We agree with you! Today we eliminated the $9.95 preparation fee in TurboTax desktop products. Now you can prepare and print multiple returns at no additional cost and TurboTax DOES include free federal e-filing...we eliminated that fee at the beginning of this tax season. We do hear you and your feedback does count!

[Wei_Zhu]

Good to hear the change of course. TurboTax listens :-)
However, was it TurboTax or someone else who messed with allowing only an single install per copy a couple of years ago?

[happiernow]

i too was a turbo tax user for years but the 10 dollar increase for basic has driven me to tax act.i purchased tax act federal and state for 19.95. i tried the two programs last year and there was only a dollar difference in the outcome. big difference in cost as turbo was charging 59.95 for fed and state . a little tougher to use but overall well worth the 19.95.

[norvabear]

Last year's version certainly wasn't free to efile. It was such a high fee that I ended up mailing my return in and got my refund just as fast as if I'd efiled. I will probably do the same thing this year.

[RobertFHarwood]

Since I end up doing the taxes of family and friends with TurboTax ( with the 51/4 inch floppes to prove it), since the mid eighties, this was the first time in a decade I thought of going to something else. The folks I am doing the taxes for are computer lightweights, like my about eighty year old mother.

Hi Robert...I'm Julie and I work at TurboTax. Glad to hear that you're a long-time TurboTax customer - you do go way back! And that you can still prepare the return for your mom at no additional cost. Happy tax filing.

[Sausagebiscuit]

I sense damage control mode has been engaged. TurboTax having people post here to spread the good news! This wouldn't need to be done if you left off the fee to begin with.

[jmartin724]

Hey, at least they listened. I was wary of buying Turbo Tax this year for my tax returns and now see no reason not to. I have used Turbo Tax since 2001 and now see no reason to change my habits. :)

[Benlofton]

I still would rather go to a tax pro. Usually I will do mine threw turbo tax then actually go to an advisor and get atleast 2.5k MORE than I got myself. They say users make mistakes and mess it up.

[mikenzinbfe]

yes "users" do make mistakes aka through not threw...you just need to be pay more attention and proof your work before submitting it.

[Renegade Knight]

I dumped Turbo Tax some time ago. I think it's enough to buy a new version every year. No other software I use has that going for it.

[bobby_brady]

I just mail mine in. It's not worth paying the stupid fee's these companies try to tack on for something that should be free.

But I don't plan on going back to using TurboTax. I'll still with TaxCut. Intuit is always trying to push garbage onto their customers.

[brightstarbeing]

I use a program where anyone making under $30,000 a year can file using Turbotax Online for free in Michigan.

[mrhippo]

I was, until this year, a LONG time user of TurboTax, going all the way back. This debacle of theirs was the last straw for me. Their handling of the Quickbooks for the MAC issue last year was unacceptable. Their programming is becoming sloppy and their arrogance is approaching new heights.

You can count me as one of those who will not go back to any Intuit product. I pre-ordered Tax Cut and will be using it this year.

[mikenzinbfe]

i agree the pricing for turbotax is pushing the limit however after using the product with no problems for several years i switched and used taxcut software two years ago. A TOTAL NIGHTMARE, even after going over my family's returns and re-checking them all, everyone last one had computational errors or total dropouts of data that was entered. i will never use their program again, and i will never go through the stress and get so much grief as i did for switching over. honestly, i would rather do our tax returns totally by hand than use taxcut again and if turbotax ups their price much more thats exactly what i'll be doing next year but for now i'm still using taxcut and it works great 99% of the time. i have however found two errors this year, one is an issue with printing, when directed to print out both state and fed returns for filing only part of both returns print. after numerous attempts i ended up printing directly from the saved pdf file. i also had a glitch with the colorado return, the software entered as income from the fed form a negative number e.g. -$8600 dollars. i had to manually correct/overide so that zero would be entered and not the neg number. other than that no issues...

[enicideme]

I've used Turbotax for close to a decade now. Still very pleased with it. Go ahead and let this small minority of internet nerds work themselves up into a tizzy over a small fee. I will stick with the program.

[Shaun822]

Unless of course you have a family of 5 (2 workinf parents and 3 twenty or teenage working children), then that small fee would have been cost of product, plus ten dollars multiplied by each additional family member for about one-hundredd dollars total. But, hey we are just wokring ourselves into "a tizzy about a small fee." That doesn't even begin to account for those of us that help elderly or partially disabled relatives file.

[strongpimphand]

Internet nerds?
Small fee?

10 dollars to file per additional user is not a "small" fee. The program ranges from 20-30 dollars typically. If you were to file taxes for yourself, your two elderly parents, and your child that just turned 18 and wanted to file, you would be paying 30 dollars extra!

Turbotax already takes their money out of your refund check just for using their services, so it's not like they're not getting paid! In fact, they could in fact give the software away for free and barely feel a dent.

But, to charge 20-30 dollars extra is just gouging. Especially when your competition doesn't.....

[Heebee Jeebies]

Too late. They still tried to do this which means they would have still screwed their customers has they just bent over. The fact that they got smacked down for it is the only reason the changed their mind not because they felt they were wrong. No, I am going to go with something else probably TaxAct.

I refuse to support **** companies like this any more.

Robert

[unknown unknown]

Just another greedy company looking to nickel and dime their customers.

[woodygg]

yes.. God forbid a company charging someone to use their products. They should be free!! People are ridiculous in thie attitude... we've become a fat, lazy society who wants our entitlements.... everything should be free.

[unknown unknown]

Did I say it should be free? no. The software is ~$50 and it's use is heavily restricted and there are additional fees after it's purchased.

[lar77]

Intuit appears to have a stategy of stealth price increases. Although they have backed off of the "one-return" policy on Turbo Tax, they are still selling Quicken 2009 Basic/Starter that has capability to import only Quicken 2008 files (in the fine print); not a technology problem because if you pay $30 extra for Quicken deluxe, you can have the ability to import Quicken 2007, and earlier, files. Although I have used both Quicken and Turbo Tax for many years, Intuit has lost credibility as being concerned about their customers. Neither of the hidden price increases are well publicized, although it is in the fine print, so legal.

[blapalong]

Regardless of the reasons behind Intuit's reversal, they deserve kudos for responding positively to this issue. It is now cheaper than last year by far because of the free federal efile.
Thanks Intuit.

[renGek]

lol, they learned their lesson from the massive backlashing they got 3-4 years ago when they tried that online registration and limited print out nonsense. Of course back then they just said it was a small minority and it was no big deal for most people......until they reported their financial results and took out a full page ad in the NY Times apologizing to everyone.

[SRK506]

Intuit didn't do anything they didn't have to. It became obvious there was a revolt over being maced. I, for one, am using TaxCut even though Intuit got caught with their hands in your wallet and backed away. After all the trouble with what was my favorite personal finance program, Quicken, and the absolute ignoring of customers for years (you still can't get tech help from anyone who knows anything about the software or speaks understandable English) I don't want to get caught in that kind of a mess with the IRS involved!

[JimS11]

If Julie from Intuit is still montoring can she explain how Turbo tax can still justify being at least $10 more expensive then TaxCut. I know alot of people who have switched and are very happy. I'm tempted to myself. I want to stay but the products seem so similar. What drives the primium price?

[dajames61]

Hi all. David from H&R Block TaxCut. I think if you look closely you will see that there are several distinct differences between TaxCut and TurboTax, besides the fact that TaxCut is less expensive. Go here to see a product comparision: http://www.digits.hrblock.com/topicsofinterest/efile/truecost.php

[Joe_the_Geek]

Well guys, here's the bottom line. I've been using Turbo Tax for about 10 years now. I've read how Intuit tried to sneak in an extra $10 fee per printed tax form, and I have read how Intuit has now backtracked and is now saying they will eliminate this charge per print in because it "better positions TurboTax in the marketplace with an even stronger value proposition for consumers."

Now wait just a minute here, pal. You guys got caught red handed in trying to bilk people out of 10 bux for printing up extra returns. Correct? Now you are saying that you're eliminating this charge because you'll be able to offer a better value to the customer?

People aren't dumb. You guys are backtracking because the sh@t hit the fan and you saw zillions of customers jump ship over to Tax Cut.

Although the policy has been changed, just to show Intuit that I am not pleased with this skulduggery, I'm going to use Tax Cut to protest and to also see if it is a better product.

Your marketing department evidently has a spy for H & R Block working on the inside. How else could Tax Cut get such a big surge in extra sales? lol.

Intuit, you have done what H & R Block's Tax Cut have been trying to do for years...get Turbo Tax customers to try Tax Cut.

[JRosol]

The over-zealous MBA rookie that pitched this pricing scheme to Intuit brass probably thought the revenue increase would be outweigh the backlash. As a Turbo Tax customer for 19 years, I've appreciated their well-crafted (for me) software package. However, the brazen policy of charging for subsequent filings rubs me the wrong way, no matter how much backpedaling they do. They should have seen this coming.

The "You've got People" people just got another person. Me.

Hello TaxCut!