According to Wednesday's announcement and a series of documents, the U.S. Department of Justice is calling shenanigans on Intuit's ambitions, at least to some extent.
Intuit has stable user-oriented financial software, including budgeting application Mint for business accounting, do-it-yourself tax software TurboTax and QuickBooks. The company initially announced the acquisition of Credit Karma in February. According to its own accounts, Intuit was paying $7.1 billion.
In its antitrust case released today, the US Department of Justice does not oppose most of the new acquisition, but requires Intuit to withdraw from the tax business of Credit Karma, which the company claims is TurboTax's biggest competitor. The US Department of Justice wrote in its complaint:
"In 2020, approximately 41 million individuals filed a federal tax return using Intuit's TurboTax, accounting for about 66% of the total market for DDIY tax preparation products. During the same time period, approximately two million individuals filed a federal tax return using Credit Karma's DDIY tax preparation product, accounting for about 3% of the total market."
It is unclear how much Square will pay for Credit Karma's taxation business. The US Department of Justice also pointed out that this business is a unique threat to TurboTax because it provides services for free.
As far as Square is concerned, it also runs CashApp, which is increasingly involved in Bitcoin. On the other hand, Intuit attracted criticism from crypto guru Andreas Antonopoulos last year. Antonopoulos claimed that Intuit blocked his credit card payments on the company's accounting services because he used crypto.
Earlier this month, the US Department of Justice filed another antitrust lawsuit to pay for Visa's attempt to acquire Plaid.