04 — Consumers & Segments

Who files, how they split, what they actually want, and why assisted is growing.
Sources: research/SOURCE_INDEX.md — [S4][S6][S7]. Demographic splits are directional (survey data); re-validate before external use.

The base

• ~146M individual returns filed per year. [S7]
• ~2/3 of US adults use a tax-prep service (software or a person); ~1/3 DIY without help. [S4][S6]

How the segments split (directional)

General skews from filing-behavior surveys [S4]:
- DIY-leaning: younger (18–34 file digitally themselves at higher rates), single, renters, simpler returns.
- Paid/assisted-leaning: older (boomers over-index on paid preparers), higher-income, homeowners, and anyone with complexity (self-employment, investments, rental income, life events).
- Complexity is the key axis — the more life events and income types, the more likely a filer pays for help or an expert.

Jobs-to-be-done (what filers actually want)

1. Accuracy / don't get in trouble — avoid errors, penalties, audits.
2. Maximize the refund — get every credit/deduction (the emotional headline).
3. Speed & ease — get it done fast, especially for simple returns.
4. Confidence — reassurance they did it right (this is what the expert sells).
5. Protection — audit support, guarantees, "someone has my back."

Different segments weight these differently: a young simple filer wants speed + free; a self-employed or newly-complex filer wants confidence + accuracy (and will pay for an expert).

Why assisted (TurboTax Live) is growing

As returns get more complex (gig income, investments, life changes) and anxiety stays high, more filers want a human in the loop. That's why TurboTax Live is the growth engine (+29% new assisted customers, Q3 FY26) and why Intuit is happy to trade some pure-DIY volume for higher-ARPU assisted relationships. [S2 — see file 05/08]

Retention dynamics

• Low churn — only ~34% of TurboTax users report considering alternatives. [S4]
• Prior-year carryforward (your data pre-filled next year) is a real switching cost.
• Trust + habit — a once-a-year, high-stakes task favors the tool you already trust.

The Credit Karma member angle

Credit Karma brings a different, younger, credit-focused consumer — people managing credit scores, loans, and everyday money, often earlier in their financial journey. Strategically, CK members are:
- A top-of-funnel into TurboTax (and vice-versa), and
- A source of financial data + engagement year-round (tax is once a year; credit is always-on).
This is the heart of the ecosystem flywheel (file 09) and directly relevant to Consumer Group's cross-product strategy.

Analysis

The consumer story cuts two ways for Intuit: complexity + anxiety keep pushing filers toward paid/assisted (good for ARPU), but the simple-return base is exactly where free competitors and general LLMs are strongest (file 11). The defensible customer is the complex, anxious, trust-seeking filer — which is why Intuit is investing in the expert + AI-with-guardrails model rather than racing to the bottom on free.