DoJ makes fintech giant sell Credit Karma's tax wing to Square before $7.1B acquisition

DoJ makes fintech big promote Credit score Karma’s tax wing to Sq. earlier than $7.1B acquisition

Per an announcement and sequence of filings on Wednesday, the U.S. Division of Justice is looking shenanigans on Intuit’s ambitions, a minimum of partly.

Intuit owns a steady of user-facing finance software program, together with budgeting app Mint, digital DIY tax software program TurboTax, and QuickBooks, for enterprise accounting. The agency initially introduced its acquisition of Credit score Karma again in February. By its personal account, Intuit was paying $7.1 billion.

In its antitrust case launched at the moment, the DoJ doesn’t object to the majority of the brand new acquisition, however has mandated that Intuit divest from Credit score Karma’s tax enterprise, which they are saying is a prime competitor to TurboTax. In its criticism, the DoJ wrote:

“In 2020, roughly 41 million people filed a federal tax return utilizing Intuit’s TurboTax, accounting for about 66% of the overall marketplace for DDIY tax preparation merchandise. Throughout the identical time interval, roughly two million people filed a federal tax return utilizing Credit score Karma’s DDIY tax preparation product, accounting for about 3% of the overall market.”

How a lot Sq. will likely be paying for Credit score Karma’s tax enterprise stays unknown. The DoJ additionally famous that the enterprise is a singular risk to TurboTax as a result of it provides its companies without spending a dime.