Artificial intelligence is becoming a bigger part of everyday life. We see it in banking, healthcare, customer service, and now even taxes. The IRS has already started using more technology to review tax returns, identify fraud, and improve enforcement efforts. The question is whether this will help taxpayers or create even more problems.
There are definitely some benefits to the IRS using AI. For years, the IRS has struggled with outdated systems, staffing shortages, long wait times, and delays in processing returns and notices. Many taxpayers and tax professionals have experienced the frustration of waiting months for responses or struggling to get someone on the phone. If AI can help speed up these processes, that could be a positive change.
AI may also help the IRS better identify fraud and abusive tax schemes. Instead of manually reviewing every return, technology can quickly scan large amounts of information and identify patterns that may signal inaccurate reporting or suspicious activity. This could help the IRS focus more attention on people intentionally avoiding taxes instead of randomly targeting compliant taxpayers.
But there is another side to this conversation that should not be ignored.
As a CPA, I’ve seen firsthand how difficult it already is for many taxpayers to navigate the IRS today. Most people do not fully understand the tax system, the notices they receive, or how to properly respond when problems arise. Even something as simple as reaching the right IRS department can become frustrating and time-consuming.
I’ve also seen clients panic after receiving multiple IRS notices in the mail. In many cases, they are already overwhelmed financially before the letters even arrive. If AI increases automated enforcement activity or generates more notices, there is a real possibility that taxpayers will feel even more stressed and intimidated by the process.
Taxes are not always simple. Every taxpayer’s situation is different. A computer system may flag certain deductions, transactions, or income patterns as “high risk” without understanding the full story behind them. Just because something looks unusual on paper does not mean someone did something wrong.
This is where AI can become concerning if there is too much reliance on automation and not enough human review. A computer may identify patterns, but it cannot fully understand hardship, business struggles, medical issues, or honest mistakes.
That is also why taxpayers will continue to need experienced professionals in their corner. CPAs, enrolled agents, and tax attorneys help provide context that technology cannot always recognize. They help taxpayers communicate with the IRS, protect their rights, and avoid making situations worse by responding incorrectly or ignoring notices altogether.
Another major concern is privacy. The IRS holds extremely sensitive financial information for millions of Americans. As AI systems become more advanced, there must be strong protections in place to ensure taxpayer information remains secure and is not misused.
The reality is that AI is not going away. The IRS will continue using more technology in the years ahead, just like banks and businesses already do today. Some of these advancements may improve efficiency and reduce fraud, which is good for the tax system overall. But there must still be balance.
Technology should support the tax system, not completely control it.
At the end of the day, taxes involve people, businesses, families, and real financial situations. While AI may help identify issues faster, there will always be a need for human judgment and experienced tax professionals to ensure taxpayers are treated fairly and accurately.
As the IRS moves further into the world of AI, taxpayers should remember one important thing: the computer is not always right. That is exactly why having a knowledgeable tax professional on your side may become more important than ever.
