TurboTax Price Hike Stirs Outrage at Amazon [UPDATED]

Revisions incorporated into Intuit's TurboTax 2008 have led to a bit of a tax revolt by reviewers on Amazon.com.


The tax preparation program has garnered an Amazon customer rating of one and a half stars out of five. As of Sunday afternoon, an overwhelming 82 reviewers (out of 90) gave the program the minimum one star, compared with four reviewers who gave it the full five-star rating.

However, it's not the features nor functionality with which the majority of reviewers are taking issue. Many reviewers were upset that Intuit increased the retail price of the software from $44.95 for the 2007 edition to $59.95 for the 2008 edition--a 33 percent price bump.

Most frustrating for reviewers--many of whom identified themselves as longtime TurboTax users--were the revised fees for the number of returns prepared. This year, Intuit began charging users an additional $9.95 for each additional return they prepare, regardless of whether the return is printed or filed electronically.

Read the rest at: Amazon reviewers slam TurboTax fee changes | Business Tech - CNET News.

Meanwhile, a spokesperson for H&R Block sent in this comment:

Hi Rick,

I just read your post about the reaction on Amazon to the TurboTax price hike and I thought you may be interested in a comparison chart that outlines the true cost of e-file<http://digits.hrblock.com/topicsofinterest/efile/truecost.php> to find out what people are really paying for with their tax software choice:

  • Essentially TurboTax's software model is like a "rental" model - you buy the software but pay for each additional return that you print vs. TaxCut which lets you prepare and E-File up to 5 [IRS stipulation] additional Federal Return(s).
  • H&R Block is a supporter of e-filing, setting the standard with 100% of its products and services now including federal e-file at no additional cost to the consumer.
  • Additionally, H&R Block eliminated all e-file fees in its TaxWorks preparation software starting in tax year 2007. Intuit has not eliminated all e-file fees in its professional tax preparation series, forcing tens of thousands of taxpayers to continue to pay e-file charges through their professional preparers.

I also wanted to point you to a news release <http://www.hrblock.com/press/Article.jsp?articleid=22236> that H&R Block put out earlier this week detailing its offer of totally free federal e-file without raising prices.



TurboTax Now Includes Preparation and Printing of Multiple

Returns at no Additional Cost

Free E-filing Included with Five Federal Returns

SAN DIEGO - Dec. 11, 2008 - Intuit Inc. (Nasdaq: INTU) today announced that customers using its industry-leading TurboTax® desktop software products can now prepare and print multiple returns at no additional cost. As previously announced, TurboTax includes free e-filing with every federal return and is the only tax software to include audit support, whether customers print or e-file.

"We're responding to changing market conditions and customer feedback," said Dan Maurer, general manager of Intuit's consumer division. "We believe this better positions TurboTax in the marketplace with an even stronger value proposition for consumers. It's one more way we help make it easier for TurboTax customers to keep more money in their pockets."

TurboTax makes doing taxes easier than ever and guarantees taxpayers will get their biggest possible refund. TurboTax customers also benefit from exclusive, award-winning features that are included at no additional cost, such as:

  • Built-in guidance for more than 350 possible deductions and credits to help taxpayers get the biggest tax refund possible, guaranteed
  • Audit support with every return - whether customers print or e-file unlike other tax software products. The TurboTax Audit Risk Meter helps customers reduce their risk of an audit before they file and a downloadable Audit Support Center assists customers in the unlikely event they are audited.
  • Instant answers from other TurboTax users and tax experts online via the TurboTax Live Community.
  • ItsDeductible helps taxpayers get the biggest write-off for the items they donate to charity by automatically assigning values to those items and seamlessly transferring the information into TurboTax.
  • Faster filing designed to help people with simple tax returns complete their taxes in less than an hour.
  • A cost basis look-up tool unique to TurboTax easily and accurately determines the cost basis of stocks and mutual funds.

During January, anyone can get a free answer to a personal federal tax question at www.FreeTaxQuestion.com. Unlike other software products, no purchase is necessary. Consumers who submit a question online will receive a personal call back, at a time they request, from a tax expert from TurboTax.

Intuit expects this decision will result in a deferral of approximately $70 million of revenue from Intuit's second fiscal quarter to its third fiscal quarter. With this change, Intuit's expected results for the second quarter are:

  • Revenue of $790 million to $810 million, down 3 percent to 5 percent from the year-ago quarter.
  • Non-GAAP operating income of $135 million to $149 million and GAAP operating income of $75 million to $89 million.
  • Non-GAAP diluted earnings per share of 26 cents to 28 cents and GAAP diluted earnings per share of 16 cents to 18 cents.

There is no change to previously issued full fiscal year 2009 revenue, operating income or earnings per share guidance.

TurboTax desktop customers can e-file up to five federal tax returns, the limit set by the IRS. Early filers who have already completed a 2008 return and paid the $9.95 additional preparation fee will receive a refund. Those who have already purchased the packaged software can update their version by using the easy, one-click update.

3 Responses to “TurboTax Price Hike Stirs Outrage at Amazon [UPDATED]”

  1. Jane thomas

    Bob Meighan is ripping people off with their “Premium” charges. If you google “TurboTax charged me for premium services when I didn’t want it”, you will see many many people who got beat our of their hard earned money.

    As I was working on my tax return, the software keeps popping up an ad asking if the taxpayer wants to purchase “Premium bundle” which would allow auditing help. This message pops up about 10x’s throughout. Because my taxes are not complicated, I keep declining.

    Well Turbotax waited until I was 99% done and wouldn’t let me finalize anything until I said “yes” to get out of the cycle.

    Then the IRS sent me a letter asking for a document regarding my mortgage credit allowance. Of course Turbo Tax sends me an email stating they want to be paid because I wasn’t able to obtain my refund. First they sent me an email asking for $74 before April 6th and then they just deducted $111 out of my checking.

    I called Turbo tax and they stated that because my tax return was processed online, I couldn’t get the refund for the Premium. I asked to speak with a manager and was told there were no managers available and that they would take my information and have a manager contact me. Three (3) days later and no call.

    What Turbo Tax doesn’t realize is that it is quite easy for me to use plenty of other tax return software next year, which I plan to do. As many businesses that are closing these days, why does Turbo Tax think they can scam people and not pay a price.

    When companies taste success, they turn around and start ripping off the same people that helped to make them successful. I can’t afford to put gas in my car, let alone food on the table every night but I learned my lesson and I hope someday, Turbo Tax will learn theirs.

    Bob Meighan…I hope you fucking get everything you deserve and more…I wish you bad, bad luck from this day forward.

  2. Max Silver


    Understand, in an age where prices keep going up, and commodity costs keep going down (even thought the latter has not always reflected at retail), Intuit taking up costs on their consumers, on a product that is only a tool to help them through a civic duty that is complex and confusing, and makes them completely nervous as they go through the process of complying, was completely egregious. Also forcing the consumer to purchase the product with the efile purchase built into the cost was not exactly Intuit supporting the public (honestly, printing and sending a return to the IRS for less than a $1 is a more cost effective means than forcing the consumer base to a more expensive software proposition; your company did raise the cost, and part of that cost was to subsidize this new “free” efile). What was more astounding was the report that Intuit thought that charging their customers for printing only one prepared tax return for software they thought they purchased the license was much more greedy than you are leading us to believe here.

    I have always used your products, but have come across this exploitation of the Intuit customer before. This occurred when I purchased Quickbooks for Mac (after using it for years on PC). When I went to move the files over, the Mac version could not convert, because I did not purchase an upgrade in between. Luckily for $100+, Intuit would convert the files for me. I was appalled; and in complete disbelief called Intuit, who confirmed this. I had a choice, restart with new software which would have been time consuming or acquiesce to this charge. I found a third option, buy a used version of PC software for less than half the price, just so I could convert the files to my new Mac. Disgusting.

    You may think you have heard your customers, but I don’t believe you HEARD them. They want an inexpensive means to help them do a government mandated document to fulfill a civil duty and minimizing their chance of making penalizing mistakes. Intuit completely took advantage of their market leadership and exploited its core consumers. This was not addressed in your note, but should be addressed, Bob. Greed took over when consumers are just asking for a little cost effective help on complying with law, and Intuit takes the position of working on their nervousness and their lack of understanding of a complex tax code. You and Intuit should be ashamed.

    However, as the H&R Block spokesperson commented, Bob, you are not the only company who makes this type of software; there is also H&R Block Tax Cut, and 2nd Story’s Tax Act. There is also the free electronic documents that the IRS provides. Perhaps a consumer revolt is warranted.


  3. Bob Meighan

    Rick… As I’m sure you’re aware, yesterday we announced that TurboTax now includes preparation and printing of multiple returns at no additional cost. Plus, as previously announced, TurboTax includes free e-filing with every federal return (up to the IRS limit of 5) and is the only tax software to include audit support, whether customers print or e-file.

    We believe these changes make TurboTax the best value for consumers. Including free e-filing with every federal return means a savings of nearly $75 for some of our customers versus last year and a savings of up to $40 compared to our original pricing this year. I believe this now truly reflects our commitment to helping our customers keep more money in their pockets.

    We have over 17 million loyal, passionate customers who genuinely care about what we do and who take the time to tell us. Our decision recognizes that our customers’ opinions really do count.

    Bob Meighan
    VP, TurboTax


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