The Internal Revenue Service (IRS) is leveraging artificial intelligence (AI) chatbots to enhance taxpayer assistance, with potential implications for tax practitioners and their clients. Eric Slayback, acting director of collection policy in the IRS Small Business/Self-Employed Division, recently provided insights into the agency's chatbot initiatives at the American Bar Association Virtual Fall Tax Meeting.
Key Developments:
- Widespread Adoption: Millions of taxpayers are utilizing IRS chatbots for tax-related inquiries.
- Data-Driven Improvements: The IRS is analyzing chatbot interactions to refine its guidance and notices, potentially affecting how practitioners access and interpret IRS information.
- Expansion Plans: The IRS's 2024 strategic operating plan supplement indicates an intent to expand chatbot and voice bot usage in fiscal year 2025, utilizing Inflation Reduction Act funding.
- High Success Rate: According to Slayback, a significant percentage of chatbot users are finding satisfactory answers without requiring human assistance.
- Authentication for Sensitive Information: When available, users can request authenticated interactions with live assisters, allowing for the disclosure of sensitive information and completion of account actions.
- Shift in Communication Preferences: Slayback anticipates a future decrease in phone calls, with more taxpayers preferring text-based chat interactions.
Implications for Tax Practitioners:
- Client Education: Practitioners may need to guide clients on effectively using IRS chatbots for basic inquiries but this could save time on phone calls.
- Practice Efficiency: As more routine questions are handled by chatbots, practitioners may see a shift in the types of issues clients bring to them.
- Staying Informed: The feedback loop between chatbot queries and IRS guidance may lead to more frequent updates in IRS communications, requiring practitioners to stay vigilant for changes.
- Privacy and Security: While the IRS emphasizes privacy and integrity, practitioners should be prepared to advise clients on the secure use of these technologies.
- Adapting to New Technologies: As the IRS continues to integrate AI and chatbots, tax professionals may need to familiarize themselves with these tools to better assist clients and interact with the agency.
The IRS's adoption of AI-powered chatbots represents a significant shift in taxpayer service delivery. Tax practitioners should monitor these developments closely, as they may impact client interactions, information accessibility, and the overall landscape of tax practice in the coming years, and ideally speed up IRS resolution times.
Christine Gervais is a licensed CPA, using her skills to help businesses grow and achieve their fullest potential. Christine has a Master’s degree in accounting from Southern New Hampshire University in addition to holding her CPA license for over a decade. Notably, Christine is a nationally recognized speaker providing education to other CPAs on how to best serve clients as well as instruction on a wide variety of topics for business owners on how to maximize success. Christine prides herself on the value she can bring to clients with her extensive tax knowledge and provides strategic, forward-thinking financial strategies to help clients grow. When not behind her desk, you can find Christine spending quality time with her daughter and stepson or tending to the family’s excessively loved farm animals.
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