Intuit beats FTC in court, ending restrictions on "free" TurboTax ads
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The Bottom Line
A federal court invalidated FTC restrictions on Intuit's "free" TurboTax ads, allowing deceptive marketing despite two-thirds of taxpayers unable to use the free service.
How This Affects You
If you file taxes with TurboTax, you may face misleading "free" ads while actually needing to pay for the version that covers your tax situation.
AI Summary
A federal appeals court on Friday invalidated the FTC's 2024 order requiring Intuit to add clearer disclaimers to TurboTax ads claiming the service is free. The 5th Circuit panel ruled 3–0 that the FTC's use of an administrative law judge to adjudicate the deceptive advertising claim violated constitutional separation of powers, citing the Supreme Court's recent SEC v. Jarkesy decision. The FTC had found that Intuit's ads were misleading because roughly two-thirds of taxpayers cannot actually file for free using TurboTax, despite the company's marketing language. Intuit's legal victory means the company is no longer bound by the restrictions imposed under then-FTC Chair Lina Khan's enforcement action. The ruling potentially weakens the FTC's enforcement authority over deceptive advertising claims pursued through its administrative process.
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