No, AI chatbots like ChatGPT can't do your taxes, and here's why

PHOENIX - Even if they have never used it, a lot of people have heard of ChatGPT.

According to a Pew Research Center survey released in May 2023, 57% of U.S. adults surveyed have heard either a little or a lot about ChatGPT, described in the survey as "an artificial intelligence (AI) program used to create text."

Also Read: ChatGPT: What you should know about the AI chatbot and its impacts, both good and bad

With 2024's tax season now underway, some may wonder whether chatbots like ChatGPT can be used to help in creating tax returns. Some experts say people shouldn't rely on it.

Here's what to know.

Can you use an AI service like ChatGPT to generate a tax return?

(Luke Sharrett/Bloomberg via Getty Images)

Based on a test we did on ChatGPT, a simplified tax return example can be generated based on the information you provide. ChatGPT's response included a disclaimer that it was "a simplified example," and that the actual tax return may vary due to other factors.

"It's always a good idea to consult with a tax professional or use tax preparation software to ensure accuracy," a portion of the response reads.

Some AI services, such as Google's Gemini (formerly called Bard), clearly state that they cannot generate a complete tax return because it would be irresponsible for them to do so, as the chatbot is not a licensed tax professional. The response from Gemini, however, did include links to various resources on the IRS website.

Are AI chatbots helpful when it comes to tax preparation?

According to an article published by the University of Illinois Tax School in April 2023, chatbots like ChatGPT can benefit a person's tax practices, such as reviewing tax returns for errors, inconsistencies, and compliance with tax laws and regulations.

Meanwhile, an article published in September 2023 by the New Jersey Society of Certified Public Accountants (NJCPA) states that a person questioning whether to adopt AI in their tax practice is akin to an accountant deciding 20 years ago on whether to use tax preparation software, or continuing to prepare paper tax returns.

So, what are the downfalls?

Both articles listed above included a disclaimer for AI chatbots.

The article on the University of Illinois Tax School's website states that chatbots like ChatGPT and other AI tools should not be used as a replacement for human expertise.

"Always exercise professional judgment and verify the accuracy of the information provided by ChatGPT before relying on it for making tax decisions or providing advice to clients," a portion of the article states.

The article published by NJCPA, meanwhile, states that "professional expertise and judgment still remain crucial in interpreting and applying the information provided by the model."

An article published by CNet in February 2024 also listed some reasons not to use AI for your tax returns, including worries over the security of personal data, outdated information, and the potential for inaccurate calculations.

Can chatbots get stuff wrong?

At least one incident has illustrated the potential pitfall for AI chatbots, in terms of accuracy.

In May 2023, it was reported that an attorney representing a client in a lawsuit against an airline company was called out for using ChatGPT after fictitious court cases were cited.

Read More: Lawyer busted for using ChatGPT to write brief after fictitious court cases cited

The client, identified as Roberto Mata, was suing the airline company after he claimed an employee struck him "in his left knee with a metal serving cart" during a 2019 flight to New York, causing him "to suffer severe personal injuries."

When the airline filed a motion to dismiss the lawsuit, Mata's attorneys opposed it, citing several court cases and decisions as to why the lawsuit should go forward. Attorneys for the airline later brought the matter to a judge, and according to an affidavit, one of Mata's attorneys responded that he "consulted the artificial intelligence website ChatGPT in order to supplement the legal research performed."

ChatGPT appeared to have given the attorney nonexistent cases as part of the research. The attorney admitted that he did not check the source of ChatGPT and apologized for his actions, saying he never intended to deceive.

According to a Bloomberg Law article published in June 2023, two lawyers were fined $5,000 in connection with the incident. At the time, it was stated that the two could face additional discipline.

What should I do?

An article on USA.gov states the IRS recommends using tax preparation software to e-file for the easiest and most accurate returns.

The IRS has also rolled out a pilot program that allows people in certain states to directly file their federal tax returns online, for free. 

(This website does not provide financial advice. The content in this article is for informational purposes only, and should not be considered as a substitute for financial advice provided by trained professionals. Please reach out to a trained and trusted advisor for any finance-related questions.)