Credit Karma is an American multinational personal finance company founded in 2007. They’re headquartered in San Francisco, CA. TurboTax is a software package for preparing American income tax returns produced by Intuit.
Credit Karma offers a 5-day early program where individuals can get their tax refund up to five days early when they have the money deposited with Credit Karma Money. However, individuals find this program misleading because Credit Karma failed to mention that if individuals signed up with Credit Karma and got tax preparation fees taken out, then they wouldn’t qualify to get their tax refund back early. This mainly focuses on people that use TurboTax to file their taxes or take the Refund Advance loan. In addition, TurboTax and Credit Karma have listed on the TurboTax website that if individuals file using TurboTax and deposit the money into a Credit Karma account, they will receive a $100 bonus in addition to getting the 5-day early deposit, but not everyone is getting this.
Failing to bring awareness to the restrictions of this 5-day early program and the $100 bonus forces people to wait longer for their refunds and potentially never get their $100 bonus. Some customers have stated that they would not have deposited their tax refund into Credit Karma absent the misrepresentation.
There was a similar dispute against Moneytree, Inc. Moneytree ran deceptive advertisements online offering to cash consumers’ tax refund checks. The Consumer Financial Protection Bureau required Moneytree to pay $255,000 in redress to victims and $250,000 in civil penalties.