IRS turns to artificial intelligence to identify potential audits

The Internal Revenue Service is adding artificial intelligence (or “AI”) to the agency’s tool box for identifying potential audits or criminal tax evaders. The AI works by taking in all available information from past and present IRS audits and prosecutions to discover any pattern of factors that results in more changes at audit or convictions for tax fraud.

The AI will then apply any patterns when reviewing new tax returns and mark any that the computer thinks demonstrate increased likelihood of significant changes under audit or criminal conviction.

As voluntary compliance with US tax code is declining and the number of tax returns the IRS most process, expect the Service to turn to more and more advanced technology like AI in its fight to collect as much money as possible.

If you want advice on avoiding problems in the future or you under audit and need help now, contact P. Christopher Wegner at 239.449.9200 or cwegner@wegnerlawfirm.com.