TaxAct $14,950,000 Settlement for Unauthorized Data Sharing Claims

TaxAct, Inc. has agreed to pay $14,950,000 to settle a class action lawsuit for alleged unauthorized sharing of users’ personal and financial information with third parties such as Facebook and Google. This settlement provides monetary compensation and additional benefits to eligible users.

Who Benefits?: All who used a TaxAct online do-it-yourself consumer Form 1040 tax filing product and filed a tax return with a United States postal address using the TaxAct online product between January 1, 2018, and December 31, 2022.

How much can I get?: Eligible users can receive approximately $18.65 each, along with complimentary use of TaxAct® Xpert Assist for their tax year 2024 return.

Can I Claim an Award?

To be eligible for the settlement award, you must be a member of one of the two Settlement Classes:

• Nationwide Class: All natural persons who used a TaxAct online do-it-yourself consumer Form 1040 tax filing product and filed a tax return using the TaxAct online product between January 1, 2018, and December 31, 2022, and whose postal address listed on their tax return was in the United States.
• Nationwide Married Filing Jointly Class: All natural persons whose spouse used a TaxAct online do-it-yourself consumer Form 1040 tax filing product and filed a joint tax return using the TaxAct online product during the same period, and whose postal address listed on the joint tax return was in the United States.

If, as of January 9, 2024, you filed a demand for arbitration against TaxAct to arbitrate claims that would otherwise be released in accordance with the terms of the Settlement Agreement, you are excluded from both Settlement Classes unless you elect to opt-in to the Settlement Classes by filing a timely Claim Form.

How Much Can I Claim?

The estimated payment is approximately $18.65 per claimant. However, the exact amount of the cash payment depends on the number of valid claims submitted.

In addition to the cash payment, all Authorized Claimants who return to prepare their tax year 2024 return using any TaxAct online do-it-yourself consumer Form 1040 tax return filing product (including TaxAct’s free product) will be provided with complimentary Xpert Assist. Xpert Assist provides one-on-one advice over the phone from real tax experts and allows for personalized tax advice.

Is Proof Required to Claim the Reward?

No specific proof is required to claim the reward. However, claimants must submit a valid Claim Form to be eligible for the settlement benefits.

Which TaxAct Products are Included?

The settlement concerns TaxAct’s online do-it-yourself consumer Form 1040 tax filing products used between January 1, 2018, and December 31, 2022. These products allowed users to file their tax returns online and included various features to assist with tax preparation.

How do I Claim an Award?

To claim your award, you must complete and submit a Claim Form. You can submit your Claim Form online or mail a printed Claim Form to the Settlement Administrator at the following address:

Smith-Washington v. TaxAct, Inc.

c/o Kroll Settlement Administration LLC

PO Box 225391

New York, NY 10150-5391

If you submit your Claim Form by U.S. Mail, the completed and signed Claim Form must be postmarked by September 11, 2024. If submitting a Claim Form online, you must do so by 11:59 p.m. PT on September 11, 2024.

Important Dates

• Deadline to File a Claim: September 11, 2024
• Final Approval Hearing: November 21, 2024

How Much did TaxAct Settle for?

The settlement amount is $14,950,000, which will be used to pay all valid claims submitted by Settlement Class Members, Notice and Administration Expenses, Attorneys’ Fees and Costs, and Service Awards for the Settlement Class Representatives.

The Net Settlement Fund will be allocated to Settlement Class Members who submit valid claims. The exact amount each claimant receives will depend on the number of valid claims submitted. Authorized Claimants will receive a per-point amount multiplied by the number of points they were assigned based on their class membership.

Why is There a Class Action Settlement?

This lawsuit was brought on behalf of TaxAct users who allege that TaxAct purportedly shared or otherwise made accessible to third parties certain of its users’ personal and financial information without permission. TaxAct denies any liability or wrongdoing but has agreed to the settlement to avoid the costs and risks of further litigation.

The Court has scheduled a Final Approval Hearing for November 21, 2024, to consider whether to approve the Settlement. If the Court approves the Settlement, there may be appeals. Settlement payments will be distributed as soon as possible if the Court grants Final Approval of the Settlement and after any appeals are resolved.

Who is Excluded from the Settlement?

The Settlement does not include customers who only used TaxAct’s download do-it-yourself consumer Form 1040 tax return filing product, TaxAct’s Professional products, or TaxAct’s online do-it-yourself business tax return filing products.

Additionally, not included in the settlement are those who have, as of January 9, 2024, filed a demand for arbitration against TaxAct to arbitrate claims that would otherwise be released in accordance with the terms of the Settlement unless those individuals elect to opt-in to the Settlement Classes by filing a timely Claim Form.