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April 26, 2015

Despite Crushing Publicity, TurboTax Sales Surge

Filed under: Finance,Internet,Retail — Edgar (aka MrConsumer) @ 8:56 am

  In January, we were the first to call national attention to TurboTax’s nasty and inconspicuous ploy of stripping its flagship desktop income tax preparation software of key tax forms, thus forcing long-time users to upgrade to significantly more expensive versions. (See series of Mouse Print* stories.) Customers were livid and nearly 3000 of them posted one-star reviews on Amazon.

Major media picked up on the story, and after three weeks of a public pummeling, Intuit, the maker of TurboTax, finally relented (after some half-hearted attempts to satisfy customers) and offered free upgrades to everyone.

Then came the revelation that crooks were claiming income tax refunds via TurboTax’s online software before their rightful owners could. Some states temporarily stopped accepting TurboTax returns. The FBI, Congress, and the FTC all launched investigations. And Intuit finally strengthened verification of identities on its website. This dual onslaught of negative press spanned most of January and February.

TurboTax headlines

One would think with the crushing and sustained negative publicity the company received over this period in the height of tax season that their sales would surely plummet. After all, consumers were mad as hell about the costly upgrades being forced on them, and worried as hell that TurboTax online was facilitating theft of their tax refunds.

According to Streetinsider.com, however, TurboTax desktop sales dropped only 6% or about 300,000 units, but online sales surged by two and a half million additional tax returns.

MOUSE PRINT*:

Unit Sales of 2015 TurboTax
TurboTax Sales

It is unfathomable to MrConsumer that millions felt more comfortable with TurboTax online this year than last, and that only relatively few abandoned the company’s desktop product. Wasn’t anyone paying attention except the two people who sued Intuit last week? Are all the alternatives just not up to the task? Or were those extra 2.5 million returns all filed by crooks?

• • •

January 22, 2015

Intuit Offering Partial TurboTax Upgrade Rebates

Filed under: Electronics,Finance,Retail — Edgar (aka MrConsumer) @ 9:24 pm


TurboTax Deluxe(BOSTON – January 22, 2015) – Following a public outcry from regular TurboTax Deluxe users who learned that the popular tax preparation software’s maker had stripped the program of key functionality this year, Intuit today apologized and somewhat reversed course by offering a $25 rebate to purchasers to partially cover the cost of having to upgrade to a more expensive version.

Without clear advance disclosure that its flagship product had changed and could no longer help users easily report all income from investments, self-employment, and rental property (Schedules C, D, and E), the company had sought $30 to $40 in upgrade fees disclosed partway into the program in order to restore its original functionality.

“Intuit offered a full apology but only a partial refund. They should be providing free automatic upgrades this year, and not requiring users to remember to send in for a rebate possibly months from now after they file their taxes,” commented Consumer World founder Edgar Dworsky. “The rebate doesn’t even cover the full cost of the upgrade in many cases.”

As of today, customers have posted over 1500 one-star reviews of TurboTax Deluxe on Amazon. And competitors like H&R Block have already offered disgruntled TurboTax customers their tax software free.

Dworsky launched a media blitz on January 6 to warn the public about the crippled TurboTax software, and to pressure the company to give all affected customers automatic free upgrades to restore the product’s full functionality. Until now, Intuit was only informally offering free or discounted upgrades to buyers who called to complain.

To save the company money, Intuit has narrowly defined who can get the $25 rebate. To qualify, customers have to had filed their 2013 income taxes using TurboTax Deluxe, and filed their 2014 return using either TurboTax Premier or Home & Business. And by using a rebate that can’t be submitted until one’s taxes are filed, the company will benefit from those who forget or can’t be bothered dealing with rebates.

UPDATE: Intuit has clarified whether you have to e-file or not to qualify for the rebate. If you e-file both the 2013 and 2014 return, their website can automatically validate your rebate request. If you paper filed, they will have to process the request manually by having you call their 800 number.

Intuit is not new to controversy or nickel-and-diming tactics. In 2008, it added a $9.95 fee to print or e-file a second return from TurboTax, but quickly rescinded the charge following a storm of criticism. And for years, it has arbitrarily “sunset” (deactivated) the online downloading and electronic bill payment functions of its popular Quicken checkbook software thus requiring consumers to buy a new version of the program every three years.

• • •

January 12, 2015

More TurboTax Pricing Games

Filed under: Computers,Finance,Retail — Edgar (aka MrConsumer) @ 5:42 am

  TurboTax DeluxeOur trusty mouse caused a little bit of a stir with last week’s story about Intuit yanking out key functionality from TurboTax Deluxe, and selling it back to customers via a $30 – $40 upgrade charge. There are now over 1400 one-star reviews on Amazon with consumers fuming over the changes and charges.

Game 1:

In the course of testing TurboTax Deluxe 2014, we discovered something curious with respect to the price they were charging for upgrades. If you needed to enter detailed information about investment transactions, for example, the program threw up this roadblock and advised that you would have to upgrade to “Premier” for an extra charge of $30.

$30 Upgrade to Premier

When going back to that section subsequently, on occasion the program would change the price for the required upgrade:

*MOUSE PRINT:

$25 upgrade fee

The fee dropped from $30 to $25. Going back another time, however, it was back up to $30. There was no rhyme or reason for the varying prices. Also, in the self-employment income section, the user is alternately presented with either a $30 or $40 up-charge to go from TurboTax Deluxe to “Home & Business.” Maybe Intuit is testing various price points to see what amount will be most palatable for users.



Game 2:

Another strange pricing disparity cropped up last week on the TurboTax website. When we first checked prices for downloading the desktop version from their website on December 25, this was the pricing shown:

ttpricing-12-25small

TT Deluxe was $59.99, with federal and state forms included.

Roughly two weeks later, on January 9th, it looked like things had changed.

*MOUSE PRINT:

TT prices 1-9

Now it says that for $59.99 you seemingly only get the federal return because it says “state additional.” Clicking on the state additional link does not exactly clarify matters.

state additional

Well, which is it, Intuit? Is state included or not? There is a big difference between “state additional” and “additional state.”



Game 3:

And one last example. In the pricing charts above, buying TurboTax directly from Intuit seems to give customers a $10 discount off what appears to be the regular or list price. According to both Amazon and Target, however, the “list price” for each of the four editions of TurboTax 2014 is $10 lower than Intuit represents. For example, while Intuit says that TurboTax Deluxe is regularly $69.99 but is now on sale for $59.99, Amazon and Target say that $59.99 is the list price for TurboTax Deluxe to start with. Hmmm.

• • •

January 6, 2015

Warning for TurboTax Users

Filed under: Computers,Finance,Retail — Edgar (aka MrConsumer) @ 6:17 am

 

INTUIT STRIPS TURBOTAX DELUXE OF SUPPORT
FOR KEY TAX FORMS

Many Buyers Will Have to Make Costly Upgrades

(Boston) — Regular purchasers of Intuit’s TurboTax Deluxe, the top selling desktop tax preparation software program, are in for a nasty surprise this year. The company has stripped the program of key functionality to easily report income from investments, self-employment, and rents, thereby requiring affected users to upgrade to more expensive versions.

“What a clever ploy. Yank out key parts of the program that people have used for years, and then charge them more money to get back the missing pieces,” commented ConsumerWorld.org founder Edgar Dworsky. “Imagine the reaction of perhaps millions of regular TurboTax users who may learn partway through doing their taxes that they have to pay an upgrade fee just to get the same functionality they’ve always enjoyed. They are not going to be happy.”

The full interview sections (Q&As) for filling out Schedule C (self-employment income and all expenses), Schedule D (investments), and Schedule E (rental and partnership income) are no longer in TurboTax Deluxe ($59.99 list). The complete Q&A Schedule D (with importation of brokerage data) and Schedule E are now only available in their “Premier” and higher editions ($89.99), and the full Schedule C is only available in their “Home & Business” version ($99.99). In-program upgrades from TurboTax Deluxe will cost users an additional $30 to $40, as the warning below indicates, when, for example, trying to enter investments.

*MOUSE PRINT:

$30 upgrade warning
Upgrade notice and roadblock in program when users try to enter investment income


Consumers are already voicing complaints. The product has gotten hundreds of one-star ratings on Amazon, with many posting negative reviews and expressing outrage.

Company executives say the changes were made to provide “consistency” between their online and desktop product lines. They are quick to point out that the raw forms for Schedules C, D, and E can still be filled out manually in “forms mode” in TurboTax Deluxe, but they don’t recommend it. The company acknowledges that the full question-and-answer section for filling out these forms is missing, and that by using forms mode, validation checking is not done, and taxpayers cannot file their taxes electronically.

Dworsky believes that Intuit did not do enough to alert regular purchasers of the product to the changes in advance, thus depriving them of the opportunity to shop for competing products or to buy the right product to start with. Many consumers, he says, have been using TurboTax for 10 or 20 years and just naturally grab the one they have always used.

*MOUSE PRINT:

While Intuit provides an online and back-of-package checklist of which version is best for which types of taxpayers, it is essentially similar to the one they used last year when there was full inclusion of all the schedules, and thus it is easily overlooked or misunderstood.

A more attention-grabbing disclosure like this mockup, Dworsky suggests, would not have been missed:

TurboTax Change Notice mockup

In the wake of complaints, Intuit is quietly offering free upgrades to some aggrieved users. Dworsky, however, is calling on them to do that for everyone automatically because of the abrupt changes, both as a goodwill gesture and as clear notice of the changes henceforth.

Meanwhile, recognizing an opportunity to grab market share, H&R Block, makers of H&R Block Deluxe, a competing program, is offering affected TurboTax users who have already purchased the program (Basic or Deluxe) a free copy of their software, which they say has not been crippled. To get it, consumers need to email a copy of their invoice, name, address, phone, and Windows or Mac designation to SwitchtoBlock@hrblock.com .

Intuit is not new to controversy or nickel-and-diming tactics. In 2008, it added a $9.95 fee to print or e-file a second return from TurboTax, but quickly rescinded the charge following a storm of criticism. And for years, it has arbitrarily “sunset” (deactivated) the online downloading and electronic bill payment functions of its popular Quicken checkbook software, thus requiring consumers to buy a new version of the program every three years.

Your COMMENTS are welcome below.

• • •

May 26, 2014

Barclaycard Ring: A Transparent (?) Social Credit Card

Filed under: Finance,Internet — Edgar (aka MrConsumer) @ 5:49 am

barclaycard ring  From the lost archive of unpublished Mouse Print* stories…

To appeal to 20- and 30-somethings, Barclays Bank introduced a new credit card in 2012 called the Barclaycard Ring. They said it was “the first social credit card to be designed and built through the power of community crowdsourcing.” In other words, cardholders will have input into the features, benefits, and pricing of the card.

A bank official put it this way: “Through simple and transparent terms [emphasis added], we want to pull back the curtain that has traditionally separated banks from their customers and give our community a say in weighing economic tradeoffs that can create a better cardholder experience.”

Their website went on to say: “Being candid starts with using straightforward language without the confusing legalese. But we’re taking it a step further. For the first time ever, we’re going to give you a look at our profit and loss statement, [emphasis added] which shows you how we make money from Barclaycard Ring. And with Giveback™, you’ll even get to keep some of the profits for yourself.”

This credit card sounds like something created by hippies (oops, MrConsumer is dating himself) rather than a stodgy, money-grubbing bank, doesn’t it?

*MOUSE PRINT:

The terms and conditions statement for the card, which indeed has been simplified, explains how cardholders will (or won’t) be able to see the bank’s profit and loss statement:

This profit sharing feature is not based on the actual profits of the program. Instead, the Giveback™ program contains a transparent calculation that is used to determine what will be shared with the community members and which may or may not approximate actual profits. The Giveback™ program and the profit sharing features are offered at our sole discretion. We may discontinue the program at anytime.

Oh, so you really don’t get to look at the profit and loss statement, and the bank can decide on its own to stop the profit sharing plan. Nice.

2014 Update: Checking the bank’s first annual report, and the quarterly ones through March 2014, it appears the card has not returned any money under their profit sharing Giveback program. (They have given a small amount to charity, however.) It appears that they require their annual return to exceed 3% before they rebate money to cardholders.

*MOUSE PRINT:

The bank makes a big deal about offering a low 8% variable APR, as well they should. When you look at the fine print, however, how that rate is calculated gets a little murky.

The APRs on your account will be determined each billing cycle by adding a margin to the Prime Rate (which will be the highest rate published in the Money Rates column of The Wall Street Journal on the last business day of each month). See your Cardmember Agreement for more detail.

Excuse me, I thought this bank was supposed to believe in transparency. Exactly how much above the prime rate is the bank going to charge? It would be nice to disclose it in advance.

2014 Update: The bank now discloses on the homepage and in its terms and conditions that a margin of 4.75% will be added to the prime rate in order to come up with the actual finance charge that will be assessed.

Lastly, the bank maintains a message forum for cardholders where a recent topic of concern was whether the bank was going to raise its 8% rate. A product manager for the credit card addressed that issue in a blog post, saying in part:

The last thing we want to do is change the APR that the community likes so much. My legal team will never let me say never, but our intention is to never change the 8% variable APR.

Hello? (to both the product manager and cardholders.) This is a VARIABLE rate card, which by definition does not have a fixed rate, but one that changes monthly, according to the prime rate and the terms and conditions.

Barclays has come up with a very clever marketing scheme which will no doubt attract a certain type of user. For his part, MrConsumer will just stick with his 2% back card from Fidelity/Bank of America, and let them keep the rest of the profit, if any.

• • •
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