What’s the catch when it comes to a ‘free’ tax prep site?

Report raises questions about value of privacy

Pexels photo
Pexels photo

When it comes to filing your taxes, especially online, you have what can feel like a million options.

Some companies, such as Intuit TurboTax and H&R Block, offer some sort of “free” package -- mostly to try and get you to upgrade: If you pay a little extra, typically just $50 to $100, the website will make the filing process much easier on you.

Other companies will let you file for free, as in, they’re not going to try to upsell you on a fancier package. But as an article in The Washington Post asks, what’s the price of free?

Meaning, what are you giving up in order to file free of charge?

The story looks largely at the website Credit Karma, and says if you use the site, you might be paying with your privacy.

Credit Karma CEO Kenneth Lin spoke with the Post about how the site operates.

“One reason Credit Karma got into the tax game, (Lin) said, is because it rounds out the data it needs to determine when customers might be eligible for, say, a new personal loan,” the story reads. “Credit Karma can make between tens and hundreds of dollars each time someone accepts one of its loan or card offers — and the more accurately it can target us, the more money it makes.”

Below is a screenshot from Credit Karma, explaining how the whole thing works:


About the Author: