“For AI, it helps us with pattern recognition and trends we could not see before,” said Daniel Werfel, the IRS commissioner. “It’s helping us to figure out some of those who present the greatest risk of noncompliance, in other words, who are the large partnerships that are shielding income and where will we find it.”
The decision to use AI is part of the agency’s new focus on combating sophisticated schemes used by the wealthiest of tax evaders, the statement noted. It said that in tandem with the artificial intelligence will be “dozens of Revenue Officers” assigned to the same task, as well as improved technology.
“The effort … will center on adding more attention on wealthy, partnerships and other high earners that have seen sharp drops in audit rates for these taxpayer segments during the past decade,” the announcement said.
According to the announcement, the program will target individuals with reported incomes above $1 million who have more than $250,000 in recognized tax debt. The agency cites 1,600 taxpayers in this category, collectively owing hundreds of millions of dollars in taxes. It also plans to expand its focus on digital assets, noting that 75 percent of taxpayers who use digital assets exchanges do not comply with tax laws.
The IRS began experimenting with using artificial intelligence to help with general income tax accounting in 2021, it said. In June, it announced it would be using voice and chat bots to help taxpayers with payments and collections and to reduce call times.
Julie Weil contributed to this report.
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