Why Is TurboTax Asking Me For A Donation?

Well, that headline is a little disingenuous. We know exactly why. K. filed his federal return using the free e-file service through Intuit’s TurboTax. It nagged him to upgrade to the paid service here and there during the process, which you expect when using any free service. What he didn’t expect was a pop-up with Lisa the Friendly Accountant acting like a public radio host during pledge drive week. “Intuit is a multi-billion dollar corporation,” he pointed out in his e-mail to Consumerist. “I just found this a bit greedy.”

Please donate to Intuit

I did my free e-file with Turbotax. Throughout the process they have several nag screens asking to upgrade to their paid service and I’m ok with those, it’s part of the business. At the end, after failing to get me to upgrade, they show me this screen. They’re begging for a donation, not for some charity, but for themselves. I could understand if this was a small start up or a non-profit but Intuit is a multi-billion dollar corporation. I just found this a bit greedy.

Note that they’ve set the suggested donation at $10, while the basic paid service costs $34.95. (E-filing your state tax return costs extra above that.)

Comments

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  1. agent888 says:

    It’s like trying the “pick your own price” method that has been talked about before. They just get you in the door for free and hound you to give them something for the service. It could be worse, they could be cramming advertisements down your throat.

    If you don’t like it, you can always file by mail. That will only cost you a stamp and an envelope.

    • Audiyoda28 says:

      Yeah, I guess I don’t see this as a donation – I don’t even see a mention of a donation in the message. TurboTax is pointing out you just got a free service from them – a service that costs them money (it’s not free for them to eFile on your behalf and they’re providing users with server space for their returns). If that service has value to you – then pay then what you think it’s worth. Or continue on the premise it’s free – and with that premise comes their right to remind you it’s really not.

      • DFManno says:

        Intuit is NOT offering free e-filing out of the goodness of their hearts. The tax prep companies cut a deal with IRS, in which they offered free e-filing to certain taxpayers in exchange for IRS not offering its own free e-filing.

        So they offer free e-filing so that the government doesn’t eliminate a large part of their business.

      • Firethorn says:

        My premise is that since they actually lobbied to prevent the IRS from offering a free efile of their own, allowing me to directly submit my 1040 electronically, they OWE ME.

    • Firethorn says:

      Filing by mail also has a much higher error rate and is substantially slower.

      What irks me is that Turbotax and such actually SUED the IRS to prevent them from offering a free e-file service themselves.

      I even filed my state tax return a couple times by phone back when I was still eligible for the 1040EZ.

  2. Howie411 says:

    If that is only on the free version I don’t really see it being a problem. You just saved XXX amount of money using their free software.

  3. Hoss says:

    Send them a note if you don’t like it. The idea of free service is that you’ll eventually need the full package and this free offering generates brand loyalty. So if asking for a gift to pay Lisa is offensive, send a note letting them know this is gives you a negative impression. Send it to marketing

  4. HomerSimpson says:

    “Those profits don’t grow on trees y’know!”

  5. BurtReynolds says:

    Did you expect any less?

    Just be happy you can file for free. Virginia used to have a perfectly easy to use online system called iFile for filing your state return for free, no matter what your income. It cost barely anything to run and was relatively “low tech” looking. If anything, it probably saved the Commonwealth quite a bit by encouraging e-filing.

    Then the “Free File Alliance” starting buying politicians and all of sudden there were pols arguing that they are doing taxpayers a favor by pushing them to Intuit and HR Block. With that ball rolling, it wasn’t long after that the iFile system was discontinued and now I am directed to use one of the “great” products from Intuit and HR Block.

    • Willow16 says:

      New Jersey doesn’t have free filing either. They give you a list of state approved vendors but I won’t pay extra to file my taxes. I just mail my tax return and it costs the state more for me to file.

    • chiieddy says:

      I do my state taxes for MA using a piece of paper and a pencil. State taxes are simple and I don’t qualify for free federal taxes (indicating my 1040s are NOT simple). It’s free to use paper and a pencil.

      • huadpe says:

        Please consider using a pen in the future, and not a pencil. Using erasable writing on a tax return is a bad idea.

        • Yomiko says:

          Pen is definitely best for the final copy. I used to file my MA taxes in hard copy. I would get two copies, one would be my draft/messy copy in pencil and then I would transfer over to my final copy in pen.

        • chiieddy says:

          I do the math with a pencil. The actual form is pen. Sorry that wasn’t clear.

    • Captain Spock says:

      Illinois surprisingly has a free e-File. I Like Turbotax (It allows my fiance to import her investment data rather than plowing through 22 pages of forms from the brokerage firm). They did my illinois taxes on the official form, and I just transferred the data to Illinois’ tax site rather than paying 19.99 for them to send it electronically. It took 5 minutes.

      • elangomatt says:

        Yeah, that surprises me to. Please don’t tell Gov Quinn though because he’ll see dollar signs and put a fee on it. I feel sorry for all of the people that get to the end of the TurboTax/HRBlock filing process and see “File your state taxes for only $24.95!” and just do it. The IL state’s EFile website is really easy to use once you have your federal return done.

    • tundey says:

      I remember that debate. Not only was it not beneficial for the citizens of VA it was also going to cost the state money to discontinue the iFile system. Knowing what we know about ALEC now, I won’t be surprised to learn they were behind that move (or perhaps their precursor).

    • Boven says:

      I really miss iFile. I recall one of the arguments for getting rid of it was that it would save the state money. Later I read that the whole system cost something like $90k per year to run.

      When it was discontinued, I went back to doing my VA taxes the old fashioned way and send in paper forms and pay with a check. I have to wonder how many others do the same and whether it costs the state more than $90k to process them all.

    • Lendon85 says:

      Same thing in South Carolina. We used to be able to file electonically for free through the state’s department of revenue site. They discontinued it a few years ago, so I went back to doing the paper, pen, stamp and mail process. I refuse to pay just so I can get my refund a little quicker.

  6. binkleyz says:

    Just a suggestion, but as far as I can tell, the vendors offering free e-file services are a pretty wide bunch, and if Intuit is annoying you with their begging, consider considering these alternatives:

    http://apps.irs.gov/app/freeFile/jsp/index.jsp?ck

    1040.com Free File Edition:

    Adjusted Gross Income: $57,000 or less, and
    Age: 52 or younger, and
    Live in any state or U.S. Citizens and resident aliens with foreign addresses
    Free Extensions

    TaxACT:

    Adjusted Gross Income: $57,000 or less, and
    Age: between 19 and 55, and
    Live in any state or U.S. Citizens and resident aliens with foreign addresses
    Free Extensions

    ezTaxReturn.com:

    Adjusted Gross Income: $57,000 or less, and
    Live in any of these states: AL, AR, AZ, CA, CO, GA, IL, LA, MA, MI, MS, NC, NJ, NY, OH, PA, VA, and WI

    OnlineTaxPros.com:

    Adjusted Gross Income: between $4,000 and $57,000, and
    Live in any state, except: AK, DC, FL, NH, NV, SD, TN, TX, WA and WY

    H&R Block’s Free File:

    Adjusted Gross Income: $57,000 or less, and
    Age: 52 or younger, and
    Live in any state or U.S. Citizens and resident aliens with foreign addresses

    Online Taxes at OLT.com:

    Adjusted Gross Income: between $12,050 and $57,000, and
    Live in any state or U.S. Citizens and resident aliens with foreign addresses
    Free Extensions

    TurboTax® Freedom Edition:

    Adjusted Gross Income:
    $31,000 or less, or
    $57,000 or less and Active military, or
    Eligible for the Earned Income Tax Credit, and
    Live in any state or U.S. Citizens and resident aliens with foreign addresses
    Free Extensions

    FreeTaxUSA® IRS Free File Edition:

    Adjusted Gross Income: $57,000 or less, and
    Age: between 23 and 64, and
    Live in any state
    Free Extensions

    TaxSlayer:

    Adjusted Gross Income: $57,000 or less, and
    Age: 25 or younger, or
    Active military, or
    Eligible for the Earned Income Tax Credit, and
    Live in any state or U.S. Citizens and resident aliens with foreign addresses
    Free Extensions
    en Español

    yesicanefile.org:

    Adjusted Gross Income: $29,000 or less, or
    Eligible for the Earned Income Tax Credit, and
    Live in any state
    Free Extensions
    en Español

    1040NOW.NET:

    Adjusted Gross Income: $57,000 or less, and
    Live in any of these states: AL, AR, AZ, CA, GA, IA, ID, IN, KY, MI, MN, MO, MS, NC, ND, NY, OK, OR, RI, SC, VA, VT or WV; or
    Adjusted Gross Income: $50,000 or less, and
    Age 64 or younger, and
    Live in any of these states: CO, CT, DC, DE, HI, IL, KS, LA, MA, MD, ME, MT, NE, NJ, NM, OH, PA, UT or WI

    eSmartTax By Liberty Tax Service:

    Adjusted Gross Income: $57,000 or less, and
    Age: 52 or younger, and
    Live in any state
    Free Extensions

    Free1040TaxReturn:

    Adjusted Gross Income: $57,000 or less, and
    Age: 71 or younger, and
    Live in any state, except: FL, NH, NV, SD, TN, TX and WA

    FileYourTaxes.com:

    Adjusted Gross Income: between $11,500 and $57,000, and
    Live in any state, except: MN and NH, or
    U.S. Citizens and resident aliens with foreign addresses
    Free Extensions

    Tax Simple:

    Adjusted Gross Income: $57,000 or less, and
    Age: 70 or younger, and
    Live in any state, except: AK, FL, NV, SD, TN, TX, WA and WY

    • Blueskylaw says:

      Longest. Post. Ever.

    • human_shield says:

      They do seem to be sticking it to senior citizens.

    • human_shield says:

      They do seem to be sticking it to senior citizens.

    • elangomatt says:

      Unfortunately, I think that oversimplifies who can file for free. Isn’t it pretty much if you can file a 1040EZ you can readily find a free service, no 1040EZ for you and you pretty much have to pay to do it online?

      • binkleyz says:

        Well no.. Each site seems to have different requirements, though it seems safe to say that if you’re filing with a 1040EZ or even a 1040A, you’re PROBABLY eligible to use these free services..

        There are AGI cutoffs, and some of them will not handle returns that use schedule D (Investments) or Schedule C (Business income).

      • Bsamm09 says:

        Nope. Check out VITA. I volunteered there for my BAP community service and I filed Sch Cs. Not all can. If you go to one near a college you can find some accounting and tax law students. My whole group was.

      • sarahq says:

        No, you can file a regular ol’ 1040 (or a 1040A) for free electronically at https://www.freefilefillableforms.com/FFA/Gateway/FED.htm. Even if you make more than $57,000, it’s still free. I’ve done this for years and there are no fees.

        It doesn’t hold your hand like TurboTax and their ilk — in other words, you have to do the preparation yourself. But it does do your math and you can sign and submit it electronically.

    • lvdave says:

      I can’t speak for any of those EXCEPT for TaxAct… I’ve been using it since 2000, when I decided enough was enough with ANYthing from Intuit. TaxAct is free and includes a free eFile, and isn’t limited to any low income.. This year the wife and I had over 100K of income, and TaxAct happily did our taxes as its done for the last 12 years…

      • Yomiko says:

        I think the 57k figure is for single or married filing separately. 100k for married filing joinly is less than twice that.

      • jiubreyn says:

        Ditto here. I’ve used TaxAct for as long as I can remember. Never had an issue with them.

    • Applekid ‚îÄ‚îÄ‚î¨ Ôªø„Éé( „Çú-„Çú„Éé) says:

      What’s so special about $57,000 AGI? Very suspicious number there.

      • pythonspam says:

        I was eligible for 2011, however I just got a raise that put me just over the threshold… Very suspicious indeed…

    • IraAntelope says:

      just be aware that many of these will let you file a 1040 for free, then want $30 to file your state return.

  7. bonzombiekitty says:

    It’s just an attempt at a “pick your own price”. I don’t really see anything wrong with it (other than the $50 option being more than just buying the basic service) provided that it only pops up when you do the completely free option.

  8. Blueskylaw says:

    1,500 people working on Turbo Tax and all of it free? They must be losing at least
    ($50,000 * 1,500 * 2.5 overhead multiplier)= $187,500,000 a year.

    My donation’s on its way.

    • chiieddy says:

      It’s not all free. It’s free if you qualify for the 1040EZ, which many don’t. I paid about $30 (not exactly) for TurboTax this year.

  9. Torgonius wants an edit button says:

    Does the graphic of Lisa start to cry if you click on ‘No thanks, I’d rather not pay?’

    If not, then clck on it, then click continue, and get on with your life.

    If it does, follow the rabbit down that hole and THEN tell us what happened.

  10. eezy-peezy says:

    I will never use online tax filing services. I have a very simple return that changes little from year to year. I do not have the patience to sit and answer questions for EVERY SINGLE LINE on the form when I know 95% of them do not apply to me.

    Now, if I could fill out my PDF forms and somehow email them to the IRS, that would be great.

    • Cat says:

      Now, if I could fill out my PDF forms and somehow email them to the IRS, that would be great.

      Actually the IRS wanted to make e-file free for all, with submission directly to the IRS online. But once again, big business won out.

      • sarahq says:

        But you can. You can file a 1040A, 1040, or 1040 EZ for free electronically at https://www.freefilefillableforms.com/FFA/Gateway/FED.htm. Even if you make more than $57,000, you can still file for free. I’ve done this for years and there are no fees.

        • Crank says:

          No you can’t.

          When you click the link at the page you posted, you get this:

          “Please note that by clicking on this link, you will leave the IRS web site and enter a privately owned web site created, operated and maintained by a private business.”

          Which is the Free File Alliance site – the same info stealing site as the rest of them. My tax return is nobody’s business but mine and the IRS.

    • misterfweem says:

      Um . . .

      http://www.irs.gov/efile/article/0,,id=237156,00.html

      I filed mine the “Free Fillable Forms” way. No third-party software involved. And no nag screens or public radio appeals for money.

      • HogwartsProfessor says:

        Ooh, cool. Thanks. I wasn’t looking forward to the Turbo Tax thing.

        No, I haven’t done it yet. I’m still looking for my document from when I sold a garage sale freebie last year for $3600. I can’t! Find! It!

      • eezy-peezy says:

        Thanks, I may try this next year!!

    • IraAntelope says:

      if you live in NY (and probably other states) you MUST efile for 2011. IRS will soon be there also.

  11. Vulpine says:

    What I find greedy is somebody that’s not willing to pay for services rendered. He effectively used Turbotax as his accountant and proceeded to stiff them as though it was his right, rather than a privilege to use their services. After all, he could have used the IRS’s own e-filing forms.

    • conquestofbread says:

      He didn’t “stiff” them on anything. He opted not to donate after using a free service.

      And it *was* his right not to pay them, as they are required to offer free filing to people who meet certain guidelines.

    • Guppy06 says:

      The service rendered is the right to push e-File uploads to the IRS.

      The payment is the requirement to offer Free File to qualified taxpayers.

      It’s Intuit that doesn’t want to pay for the service they’re using here.

  12. Clyde Barrow says:

    Really OP Mark? You’re offended? If you don’t like it, don’t give but why are you telling us about it?

  13. speaky2k says:

    I just recently filed and used the fillable forms available for free to anyone, no matter your age or how much you make. They don’t have any adds or prompts for cost and allow you to efile when done. Sure you can’t do your state taxes at the same time, but my state already has online filing on their web site. The only problem with these forms is that you have to actually read and know what you have to fill in, it doesn’t step you though, but if you have a copy of last year’s taxes you can figure out what information goes in which spot. I didn’t find it hard to do a standard return with itemized deductions, and anyone doing the EZ form should have no problems what so ever.
    https://www.freefilefillableforms.com/FFA/Gateway/FED.htm

    • sarahq says:

      I’ve been very happy using these fillable forms for three or four years now. If you prepare your own 1040 or 1040A, these are perfect for you: just simple, no-frills free e-filing.

  14. tundey says:

    Funny how the OP thought Intuit was being greedy since he didn’t pay a dime for the service he used. It’s one thing if they were asking for donations from paying customers but if you use the service for free, the least you can suffer through is the nag screens and the begging for money.

  15. RedOryx says:

    What’s the big deal? You filed for free, they are just asking for a little compensation. But since there is a $0 button, the entire donation is entirely optional. Just click you’d rather not pay and move on.

  16. Cicadymn says:

    Don’t like it?

    Don’t use them.

  17. capnike says:

    FreetaxUSA,com is also free; even for a return that itemizes deductions. State return is only 9.95.
    I’ve used them the past 2 years and been pleased. No nagging you for a donation.

    • CubeRat says:

      Ya, I like FreeTaxUSA.com, I’ve used it for about 5 years and I itemize. This year, however, they keep annoying me by sending me reminders to do my taxes that I already filed, got my refund and spent it.

  18. capnike says:

    FreetaxUSA,com is also free; even for a return that itemizes deductions. State return is only 9.95.
    I’ve used them the past 2 years and been pleased. No nagging you for a donation.

  19. capnike says:

    They are not the only free tax service out there. FreeTaxUSA.com is free even if you itemize deductions. State returns are only 9.95. No nagging for donations.

  20. capnike says:

    They are not the only free tax service out there. FreeTaxUSA.com is free even if you itemize deductions. State returns are only 9.95. No nagging for donations.

  21. Guppy06 says:

    As i recall, in order to offer e-File to anybody, Intuit is required by law to offer Free File to people who meet certain qualifications (basically people who otherwise qualify to use 1040 EZ). The IRS isn’t required to let just anybody connect to their system and push bulk uploads. If Intuit didn’t want to offer Free File, they simply have to walk away from e-Filing altogether, requiring all their customers to print and mail their paperwork.. This isn’t a charity but a calculated cost of doing business on Intuit’s part.

    This was implemented as a replacement for the old TeleFile system, where certain qualifying people could call the IRS on directly on a touchtone phone and use an automated system to file their tax report. The current tit-for-tat system on e-File/Free File is the result of the Bush Administration and GOP Congress pushing for “market-based solutions,” which apparently now includes for-profit companies putting on the airs of a charity.

    We’d be better off if the IRS just offered Free File directly and charged all tax preparers actual money to use the e-File system. It would spare taxpayers this insult to their intelligence.

    • Firethorn says:

      Personally, I’m just pro-business enough that I wouldn’t charge tax preparers to submit electronically, but I’d support the IRS having it’s own electronic E-File system.

      That way the people who pay for tax preparers would be those with more complicated returns, not this $40 to fill answer a bunch of online questions.

    • Jthon says:

      Ohh look free e-file from the IRS but no one ever seems to remember it: https://www.freefilefillableforms.com/FFA/Gateway/FED.htm

      I’ve used it for the last couple of years since my returns don’t qualify for the free e-file. (Go full 1040!)

  22. mstrmike says:

    I also used TurboTax and found the various upgrade opportunities grating. The annoying pop-up that got to me was the one asking if I wanted to tweet about how much I saved on my taxes with TurboTax. Not just a generic “big money”, but the actual amount. Thanks, but no thanks.

  23. Cerne says:

    I think Mark is a bit of an entitled asshole.

  24. oldgraygeek says:

    I loathe Intuit. I strive to avoid paying them for ANYthing.

  25. IraAntelope says:

    I do not like the part where they say you can file your tax FREE using turbotax, then when you finish, they want 29.95 to file your state return. no mention of a charge up till then.

  26. mcgyver210 says:

    Yes they are a multimillion dollar corp. but they didn’t say you have to pay so not sure what the problem is? I for one pay them allot of $$$$s monthly & value the service they give. Now I could also look at it as all their loyal paying customers are paying/subsidizing for the free services some use but I don’t have a problem with it.

    This same concept is used by Government, Some pay taxes & some don’t but many that don’t get free services not available to my family even though we pay.

    There is no such thing as FREE because someone has to pay for it to be FREE.

  27. bmeighan says:

    Efiling your state return does NOT cost extra. It is included in the price of the state service.

    Also, I would not characterize this as “begging”. Like most freeware today, the developer asks for a contribution to help offset the cost of the service. If you decline, that’s fine and TurboTax won’t ask ever again. Unlike most other free internet business models, TurboTax does NOT use advertising in its service.

    This TurboTax free service to millions of taxpayers each year is supported by its employees and shareholders in an effort to give back to taxpayers who might not otherwise be able to afford such a valuable service.

    Bob Meighan
    VP, TurboTax