IRS's free tax-filing tool: Why TurboTax says it's not worried

The Federal Trade Commission (FTC) ruled earlier this year that Intuit's (INTU) TurboTax Free was not actually free for most. Intuit CFO Sandeep Aujla joins Wealth! to discuss the future of the tax platform as more free filing programs enter the market.

"We have always offered free products. In fact, we were one of the early innovators in the free space. And free is a key component of the tax industry. You have many free participants in there. And the government introducing a free offering is not a material impact to the industry, and quite frankly, I think it's not a good use of our fiscal spending either," Aujla says.

Aujla notes that Intuit is using AI to help bring expertise to users when filing their taxes, explaining: "That's the part of the business that we're really highlighting to the investment community. It's a business that grew 17% last year. It is $1.4 billion in revenue, representing about 30% of our overall tax revenues. And, it is a business that we continue to invest in and are quite excited about its growth prospects. And that's what's giving is bolstering our confidence, quite frankly, on our ability to continue to scale our consumer group and our tax revenues."

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This post was written by Melanie Riehl

Video Transcript

Sandeep, I would be remiss if I didn't ask you just a quick question on the business here.

I mean, of course, you know, here at Yahoo Finance, we track the stock performance into it under performing some of the major averages this year, it's still up by about 3.5%.

The share price is over the course of the year to date.

I I wonder as you kind of look at the business on a go forward basis after this major FTC ruling and investigation finding TurboTax free is not free for most and into it, not renewing the free file program.

What that does for some of the guidance that the street is really trying to wrap its mind around at this juncture?

Sure, a couple of things I would say uh one is we have uh always uh offered free products.

In fact, we were one of the early uh uh innovators in the free space and free is a key component of the tax industry.

You have many uh free participants in there and the government uh introducing a free offering is a not a uh uh material impact to the industry and quite frankly, I think it's not a good use of uh uh our fiscal spending uh either.

And in terms of our guidance, you know, what we are really excited about on the tax business is, is a $35 billion market and 30 billion of that market is helping small businesses and consumers get their taxes done.

And these are the folks who typically go to someone else to get their taxes done.

This is where we are excited to use our A I to use our live expert platform to really helping small businesses and consumers getting their taxes done.

And that's the part of the business that we're really highlighting to the investment community.

It's a business that grew 17% last year.

It is $1.4 billion in revenue representing about 30% of our overall tax revenues.

It is a business that we continue to invest in and are quite excited about its growth prospects and that's what's giving is bolstering our confidence quite frankly on our ability to continue to scale our uh our consumer group and our tax revenues.

Sandeep.

I appreciate you taking the time to address that with us.

Plus looking across the small business landscape as well.

Very important topic in conversation, Sandeep Ailah, who is the Intuit?

CFO?

Appreciate the time.

Thank you, Brad.

I appreciate it.