Kimberly White/Getty Images Tax preparation companies H&R Block and Intuit, which makes TurboTax, were sued Monday for allegedly making their free tax filing tools hard to find. Taxpayers with incomes below $66,000 are eligible to file their taxes for free as part of a partnership between the Internal Revenue Service and Intuit, H&R Block and other companies. Under the agreement, the IRS has agreed not to make online tax filing free as long as the tax-preparation companies provide the service. Still, only 3% of Americans reportedly file their taxes for free every year, and locating those services can be difficult. Last month, ProPublica reported that searches for terms like "irs free file taxes" directed people to paid versions of Intuit's service. Free options were tough to pin down, according to the report. In the suit, Los Angeles City Attorney Mike Feuer said TurboTax and H&R Block have used "deceptive and misleading advertising and design schemes" to lead taxpayers to unnecessarily purchasing their products. He added that the companies have "for years defrauded the lowest earning 70 percent of American taxpayers ... by actively undermining public access to the IRS' 'Free File' program." For years, Intuit and H&R Block have lobbied to block the IRS from building its own free online tax filing system because it would compete with their products, according to ProPublica. Congress members have reportedly pushed to keep the IRS from providing free online filing. "Any suggestion that Intuit does not support the IRS Free File Program is flat wrong," said TurboTax spokesman Rick Heineman. "We stand behind our actions as being both appropriate and consistent with our values." An H&R Block representative said the company has "helped millions of Americans" with its free tax filing options, adding that use of its Free File program grew 8% this tax season. You can read the lawsuits against Intuit and H&R Block below: Intuit lawsuit by jonathan_skillings on Scribd H&R Block lawsuit by jonathan_skillings on Scribd<doc-sep>It is a truth universally acknowledged that preparing and filing your taxes causes pain comparable only to root canal or passing a kidney stone. If you’re looking for someone to blame, look to the commercial tax preparation firms Intuit (maker of TurboTax) and H&R Block. As City Atty. Mike Feuer alleges in lawsuits filed Monday against Intuit and H&R Block, the two companies have connived for years to discourage millions of taxpayers from taking advantage of a free, simple online system provided by the Internal Revenue Service. Feuer accuses the firms of “actively undermining public access to the IRS’ ‘Free File’ program.” That’s a program allowing the lowest-earning 70% of taxpayers — those with adjusted gross income of $66,000 or less — to prepare and file their federal and state taxes online for free, using the commercial services. Advertisement I want to hold the tax-preparation companies accountable, and I want to deter this behavior. L.A. City Atty. Mike Feuer Feuer compared the tax-preparation firms’ behavior to that of Wells Fargo, another of his corporate targets. Feuer’s 2015 lawsuit against Wells Fargo helped blow up the scandal over the bank’s opening of thousands of bogus accounts for customers and others. “That was a major corporation taking advantage of the consumer,” he says. ”There are some parallels. I want to hold the tax-preparation companies accountable and I want to deter this behavior.” Free File is a full-featured program that serves those taxpayers no matter how complicated their taxes. But it’s little-used; according to an investigation published last week by ProPublica, on which key elements of Feuer’s lawsuits are based, only 3% of eligible taxpayers use Free File. That’s 3 million of the 100 million taxpayers eligible. “We allege that’s no accident,” Feuer told me. “Both Intuit and H&R Block have created impediments to the IRS system.” They’ve done so despite having made a commitment to offer free online tax-prep and filing to the majority of taxpayers. Starting in 2002, the online tax-prep industry agreed to do so in return for a commitment by the IRS not to compete with its own free online tax preparation and filing services. The agreement has been periodically renewed, most recently through Oct. 31, 2021. But Feuer alleges that Intuit and H&R Block have deliberately concealed Free File from taxpayers and steered them instead to their own “free” programs, which are watered-down versions of software for which Intuit charges as much as $120 and H&R Block as much as $105. The firm’s “free” programs are useful only to taxpayers with wage income from employers. That leaves out independent contractors or those with itemized deductions. The programs charge for state filing; they’re also an opportunity for the firms to sell software upgrades for customers who don’t find their free programs sufficient. Feuer calls those ostensibly free services nothing but “decoys.” It’s been virtually impossible to find IRS Free File from the main web pages of TurboTax and H&R Block. Instead, taxpayers have had to know enough to track down the IRS program on their own, at TurboTax’s “tax freedom” website and H&R Block’s “Free File” site. They can also go to the IRS Free File site, which will steer them to one of the tax-prep firms’ own Free File programs. Advertisement Last month, ProPublica reported that Intuit even took a step to hide its Free File web page from search engines such as Google, so consumers wouldn’t find it via a routine web search. ProPublica says that after its report, Intuit changed the page coding so it would no longer be hidden from Google. In a statement issued through spokesman Rick Heineman, Intuit says: “We stand behind our actions as being both appropriate and consistent with our values. Any suggestion that Intuit does not support the IRS Free File Program is flat wrong.” H&R Block said in an emailed statement that it’s “proud to have helped millions of Americans file their returns under the Free File program” and that it has “updated our practices to make H&R Block’s [IRS] Free File offer even easier to find.” The tax-preparation services have lobbied to hamstring competition from the IRS for years. It’s not hard to figure out why: Intuit reported revenue of $2.5 billion last year from TurboTax, and H&R Block reported $243 million from “DIY tax preparation,” including its software programs. Advertisement Over the last decade, according to the Center for Responsive Politics, Intuit and H&R Block each have spent more than $24 million in lobbying on Capitol Hill, in addition to millions of dollars in campaign contributions. Those efforts appear to have borne fruit. Last month, the Democratic-controlled House passed the “Taxpayers First Act,” which includes a provision codifying the 2002 commitment, flawed as it is, into law. “That was a victory for the companies,” Feuer says. The measure now goes to the Senate. The commercial tax-prep firms and the conservative anti-tax lobby share incentives to keep tax filing complicated for most Americans; the firms want to build their customer base, the anti-tax warriors want to stoke resentment of the IRS. They’ve both opposed allowing the IRS to prepare taxpayers’ returns for them by sending forms pre-filled with all the information the IRS already has about them. As economist Austan Goolsbee proposed in 2006 before becoming an economic advisor to the Obama administration: “The IRS already receives information about each of their sources of income directly from their employers and banks. The IRS then asks these same people to spend time gathering documents and filling out tax forms, or to spend money paying tax preparers to do it.” Advertisement Obama mentioned such a plan during his first presidential campaign, but it died under lobbying assault from the tax-prep companies and anti-tax crusaders. California introduced its own program of pre-filled firms, known as ReadyReturn, in 2005. Despite constant criticism from the anti-tax lobby, many of its elements still are available under the label CalFile. Feuer in his lawsuits is seeking three remedies under California unfair competition law: restitution for the millions of taxpayers who were eligible for the free IRS service and paid unnecessary fees to the companies instead; injunctions barring the firms from erecting barriers to taxpayers’ knowledge of the IRS system and access to it; and steep financial penalties. Keep up to date with Michael Hiltzik. Follow @hiltzikm on Twitter, see his Facebook page, or email michael.hiltzik@latimes.com. Return to Michael Hiltzik’s blog.<doc-sep>WATCH: Caroline D'Amore Discusses 'Surreal' MTV's 'The Hills: New Beginnings' Experience & Pizza Girl BusinessThe Los Angeles native discusses what it was like to join the cast of "The Hills: New Beginnings" and her new line of sauce. SEC Football: CBS Sports Announces 2021 Schedule Including Alabama At Florida On September 18The SEC on CBS kicks off on September 18 with an SEC Championship game rematch between the Crimson Tide and Gators. Mayweather Vs. Paul: Showtime Sports Announces Broadcast Team For June 6 EventThe network announced its plans for the broadcast of the pay-per-view exhibition bout between Floyd Mayweather Jr. and Logan Paul. The 74th Annual 'Tony Awards' And 'The Tony Awards Present: Broadway's Back!' 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Tax filing services H&R Block and Intuit, the maker of TurboTax, are being sued by the Los Angeles city attorney for allegedly making it difficult for low-income taxpayers to find the free filing service provided by the IRS. The lawsuits against the two companies filed Monday allege they "intentionally obscure[ed] and fail[ed] to disclose" the difference between products that costs money to file taxes and the Free File program, according to NBC News. H&R Block and Intuit have faced scrutiny from lawmakers and now Los Angeles officials after a report from investigative nonprofit news outlet ProPublica found the companies allegedly intentionally made the free service on its platforms hard to find. ADVERTISEMENT The IRS that mandates that tax services companies provide a no-cost option to people with an adjusted gross income of $66,000 or less. "This is a situation where free should be free, but we allege the way these companies have structured their websites and misled consumers, free has turned out not to be free at all in so many cases," Los Angeles City Attorney Mike Feuer told NBC News. The lawsuit filed by Feuer's office on behalf of residents of California alleges the tax filing software from the two companies "manipulates them into paying” even after users inputted information showing their income to be under the threshold to qualify for the free service. Feuer is expected to hold a press conference Tuesday afternoon further detailing the allegations in the lawsuits. The IRS said this week it is reviewing allegations concerning its Free File program, following urging from Democratic lawmakers. Intuit told NBC News in a statement that "we stand behind our actions as being both appropriate and consistent with our values. Any suggestion that Intuit does not support the IRS Free File Program is flat wrong." "We look forward to working with the IRS and private industry to improve the Free File program and help it continue to grow," the company added. H&R Block said it is in compliance with the IRS's Free File program, offering four ways to file for no cost.