IRS Has Some Tough Questions to Answer About AI Scams

IRS Has Some Tough Questions To Answer About AI Scams

( – The adage regarding death and taxes being life’s only certainties may need an update regarding scams thanks to the recent rise of artificial intelligence. A bipartisan group of senators recently sent a list of tough questions to the IRS regarding scams involving the new technology.

On May 2, Senator Chuck Grassley (R-IO) issued a press release discussing a letter he sent to IRS Commissioner Daniel Werfel regarding AI scams targeting tax professionals and taxpayers. Three other senators signed the May 1 correspondence, including Maggie Hassan (D-NH), James Lankford (R-OK), and Ron Wyden (D-OR).

The letter warned the commissioner about the use of AI tools, deep fakes, and apps like ChatGTP to create “deceptive tax scams [designed] to steal (American’s) personal financial information.” Additionally, cybercriminals are using the emerging tech to trick individuals into paying overdue taxes and phony fines.

The senators noted that in the past, people could distinguish fake messages from real ones because of their grammatical errors, repeated misspellings, and inaccurate citations of the tax code. However, the scams created by AI tools are nearly flawless in form and substance, creating the need for a quick response to the emerging threat to individual taxpayers and small businesses.

The four senators also urged the IRS commissioner to direct his agency to counter those “AI-generated tax scams” and submitted a series of questions.

  • How is the IRS preparing to meet the potential increase in scams created using AI tools like ChatBPT?
    • What initiatives are in the planning stage, and which already exist to address the issue?
  • How does the IRS plan to educate tax professionals and taxpayers about the typical characteristics of the scams?
  • What path do officials think the scams will take in the short and medium term?
  • Are AI tools expected to increase the volume of tax scams in the future?
    • If so, how would this impact IRS taxpayer services?
  • Have officials received any notices of AI-generated tax scams so far?
    • If so, what is the total estimated dollar amount involved?

The letter gave Commissioner Werfel until the end of May to submit the agency’s response to those questions.

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