It is the fifth-largest provider of DDIY tax preparation products for U.S. Credit Karma Tax is Credit Karma’s DDIY tax preparation business. Credit Karma is home to more than 100 million customers and in any given month, over 35 million customers are actively engaged on the Credit Karma platform. Credit Karma’s platform provides individuals with access to free credit scores, credit monitoring, and DDIY tax preparation, among other products and services. In 2019, Intuit earned over $6.5 billion in revenue, including over $2.5 billion from sales of TurboTax products.Ĭredit Karma is a privately-held Delaware corporation based in San Francisco, California, that offers an online and mobile personal finance platform. Intuit, through its TurboTax business, is the largest provider of DDIY tax preparation products for U.S. Approximately 41 million individuals filed individual federal tax returns in 2020 using TurboTax. Intuit offers DDIY tax preparation products under the TurboTax brand. Intuit is a Delaware corporation based in Mountain View, California, that offers tax preparation, accounting, payroll, and personal finance solutions to individuals and small businesses. Intuit and Credit Karma have agreed to provide certain transition support services to Square while Square integrates Credit Karma Tax into its Cash App platform. Square is also expected to hire certain key Credit Karma employees that today support Credit Karma Tax. Under the terms of the proposed settlement, Intuit and Credit Karma must divest the assets that comprise Credit Karma Tax to Square, Inc., including relevant software and intellectual property. The combination of Intuit and Credit Karma would eliminate this competition, likely resulting in higher prices, lower quality, and less choice for consumers of DDIY tax preparation products. This always-free business model has enabled Credit Karma Tax to compete aggressively for filers who pay for TurboTax, which helps constrain TurboTax prices and push Intuit to improve TurboTax offerings. Unlike other providers, including Intuit, Credit Karma Tax never charges for its products, regardless of the complexity of an individual’s tax preparation needs. Since entering four years ago, Credit Karma Tax has become a disruptive competitor with a significant competitive impact. “Today’s divestiture to Square, another highly successful and disruptive fintech company, ensures that taxpayers will continue to both benefit from this competition and benefit from new innovative financial service offerings from both Intuit and Square.”Īccording to the complaint, Intuit’s TurboTax has enjoyed a dominant position in the market for DDIY tax preparation products for more than a decade. “Intuit’s TurboTax has long led the market for digital do-it-yourself tax filing services, but disruptive competition from Credit Karma Tax has brought substantial benefits to American taxpayers,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the department’s complaint. District Court for the District of Columbia to block Intuit’s acquisition of Credit Karma. The Justice Department’s Antitrust Division filed a civil antitrust lawsuit today in the U.S. The department said that without this divestiture, the proposed transaction would substantially lessen competition for digital do-it-yourself (DDIY) tax preparation products, which are software programs used by American taxpayers to prepare and file their federal and state returns. in order for Intuit, the creator of TurboTax, to proceed with its $7.1 billion acquisition of Credit Karma. (Credit Karma) to divest Credit Karma’s tax business, Credit Karma Tax, to Square Inc. The Department of Justice announced today that it is requiring Intuit Inc.
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