November 18, 2022
**Members using TurboTax face unreasonable delays and fees. Senators Shaheen and Warren are pushing for an investigation into TurboTax’s relationship with Green Dot Bank.**
(Washington, DC) – U.S. Senators Jeanne Shaheen (D-NH) and Elizabeth Warren (D-MA) have sent a letter to Consumer Financial Protection Bureau Director Rohit Chopra, Federal Reserve Chair Jerome Powell, and Internal Revenue Service Commissioner Charles Rettig to express concerns about the relationship between Intuit TurboTax and Green Dot Bank, which acts as a clearinghouse for TurboTax filing fee collection and tax refund distribution.
The senators’ letter comes in response to claims from New Hampshire and Massachusetts voters who are facing systemic challenges after filing tax returns online through TurboTax. Those citizens who chose to have their TurboTax fees deducted from their refunds had their refunds incorrectly deposited into new accounts with Green Dot Bank without their permission, causing undue delay and hardship, with many always have not yet received their full refunds.
“Numerous taxpayers have reported not being able to access their tax refunds due to Intuit’s partnership with Green Dot Bank.” wrote the senators. “While the Internal Revenue Service’s (IRS) online tool indicates that a refund has been issued, taxpayers find it difficult or impossible to access these funds because the taxpayer’s own banking institution has no record of them and they have no existing banking relationship with Green.” have point bench.”
When such an event occurs, the bank’s IRS technical advisors can send a formal request using Fiscal Service Form 150.1, but as the senators indicate in their letter, their staff who are assisting affected constituents have determined that the IRS Green Dot cannot force Bank to respond to their request, leaving the taxpayer in the dark and unable to receive any information on next steps. This is preventing residents from accessing the tax refund proceeds they are longing for and are entitled to. To make matters worse, by the time the taxpayer receives their refund (minus any TurboTax fees owed), the taxpayer may also have had the filing fees deducted directly from their actual bank account by TurboTax, setting the taxpayer up for another frustrating journey of refunding the receive double fees.
“The outsourcing of vital IRS functions undoubtedly benefits private companies like Intuit and Green Dot Bank, but it also directly results in financial damage and psychological distress for our constituents,” continued the senators. “We urge the IRS to develop its own simple, free filing service that taxpayers can use if they prefer not to have their refunds mitigated by fees, their tax data shared with private companies, and their money put in banks that do.” they did not choose themselves. ”
In addition to reporting these concerns to the CFPB, the Federal Reserve and the IRS, the senators are requesting a briefing on the matter within two weeks of their staff who handle this type of voter casework.
The full text of the letter can be accessed here.
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