As the tax deadline approaches, many filers are exploring the option of using AI chatbots to assist them with their tax returns. While the convenience and accessibility of these tools may seem appealing, experts warn that there are significant risks associated with relying on generative AI for tax advice. According to a recent survey, nearly 1 in 5 Americans would trust AI chatbots like ChatGPT to review their income taxes. However, it is crucial for taxpayers to proceed with caution when using these tools, as they may not provide accurate or reliable advice.
Concerns Raised by Tax Professionals
Experts in the field of taxation, such as April Walker from the American Institute of CPAs, emphasize the importance of seeking professional advice when it comes to financial matters like taxes. While AI chatbots can offer general guidance and answer basic questions, they are not equipped to provide personalized tax recommendations. In fact, some AI chatbots have been found to provide incorrect answers to specific tax queries, as their training is not tax-specific and their data may not be fully updated.
Subodha Kumar, a professor at the Fox School of Business at Temple University, has conducted tests on AI chatbots and found that while they may work well for general tax inquiries, they often fall short when it comes to more detailed questions. This is due to the fact that AI chatbots like ChatGPT are designed for general purposes and lack the specific knowledge required for accurate tax advice. Additionally, these chatbots may not account for recent tax changes or inflation adjustments, which could result in inaccurate information being provided to filers.
Another major concern with using AI chatbots for tax advice is the issue of data security. Plugging in sensitive financial information into these tools could potentially lead to data leakage and privacy breaches. Spencer Lourens, a data science expert, warns that there are multiple risks associated with sharing personal financial details with AI chatbots. While it may be possible to input general information without including sensitive data, it is important to exercise caution and avoid disclosing confidential information when using these tools.
While AI chatbots may offer some benefits in terms of convenience and accessibility, it is essential for filers to be cautious and skeptical of the advice provided by these tools. Experts recommend using AI chatbots for general inquiries and educational purposes only, and emphasize the importance of verifying any information received from these tools with a tax professional or through official sources like the IRS website. By taking a cautious approach and prioritizing data security and accuracy, taxpayers can use AI chatbots as a supplementary tool in their tax filing process, rather than relying on them exclusively for advice.
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