Americans are increasingly turning to artificial intelligence tools like ChatGPT and Claude to help prepare their tax returns, but experts warn the technology can deliver outdated or inaccurate guidance, raising the risk of costly mistakes.
About 26% of people are now using AI to file their 2025 tax returns during the current tax season, up from 11% in the prior year, according to polling from Adobe. In a post on X, Elon Musk said that his Grok AI chatbot "can help with your taxes." He was responding to another X user who said in a post that the tool helped boost a tax refund by $1,400.
But tax experts warn that Americans may be putting themselves at risk by relying on AI, as chatbots can provide outdated or misleading guidance. For example, recent tax changes under the Republicans' "one big beautiful bill act," or OBBBA, may not be reflected in AI-generated responses.
"Using AI for taxes is not new. It is integrated into tax preparation software, that's how they generate returns," Caroline Bruckner, tax professor at American University's Kogod School of Business, told CBS News. "But you want to be really careful about how you use the AIs that have become ubiquitous. AI on its own is not capable of preparing an accurate tax return."
That's in part because government websites, including IRS.gov, contain a lot of outdated information that doesn't reflect changes in the tax law. Large language models could draw from such material and present it to users as up-to-date.
"Our tax law is so incredibly complex, and the website has to have information that was true in 2020 as well as 2025, but tax laws and tax breaks have changed so much in five years," Bruckner said. "That's where generative AI can really cause problems if you just ask it a general question about deductions — it may give you a summary of deductions that are no longer applicable, or in effect for this tax year."
How can AI help with your taxes?There are, however, some useful applications of AI when it comes to tax preparation, Bruckner and other experts said.
"You can ask it a question without providing any identifying information," Bruckner said. For example, you can ask it to explain complicated tax concepts like, "What is the no tax on tips deduction?" if you are a worker who earns gratuities.
"It can be great at translating a complicated tax concept into English," Bruckner said. That said, it's always important to think critically about the output generated by AI, and to scrutinize the sources it cites.
Lisa Greene-Lewis, a tax expert with Intuit, the maker of the TurboTax filing program, said it's fine to use free, publicly available AI programs for general education purposes around tax concepts. But she doesn't recommend that people use them to file their own tax returns.
"There's a difference between those AIs and TurboTax AI models, which have been trained by hundreds of millions of tax returns and financial data points and are up-to-date with the latest tax code and validated by tax professionals," she said.
Potential pitfallsWhile AI can potentially help outline changes to the tax law under the OBBBA, like the tipped income deduction, it's no substitute for working with an experienced tax professional or tax prep-specific software tool, according to Mark Gallegos, a tax accountant at Porte Brown, an accounting firm.
"It's not going to prepare your tax return at the moment. We might get there, but we're not there yet," he said.
Danny Werfel, the former IRS commissioner from 2023 to 2025, told CBS News that ChatGPT and similar AIs are not specific to the realm of taxes and haven't been tested for accuracy. He warns never to feed sensitive personal information to such models.
"You should be very wary of using AI and seek assurances that your information won't be harvested or shared for commercial purposes," he said.
No free filing tool availableJulie Siegel, former deputy chief of staff at the Treasury Department, said people are turning to large language models, or LLMs, in the absence of a free, government-provided filing tool. The IRS eliminated its Direct File tool, created during the Biden administration, that saved taxpayers $160 each.
"People are turning to LLMs because the government made a choice to pull back on an app it already built," she said. "But these apps don't understand how a certain set of facts apply to your particular tax situation."
She added that LLMs also have difficulty interpreting between outdated and current information, in part because the IRS' materials can be misleading.
For example, an IRS form with a headline reading "No tax on overtime" might suggest to an LLM that you don't owe taxes on any overtime pay, which is inaccurate.
"So even if an LLM is looking at an authoritative source like the IRS, it may mistakenly calculate no tax at all on overtime," she said.
She doesn't trust it to be accurate, and notes that individuals alone are responsible for the accuracy of their own returns.
"If Claude misinterprets an IRS form and gets it wrong, and that causes you to owe a lot of money, you are the one at the end of the day holding the bag," she said.
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