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AI to Revolutionize Tax Payment and Collection
FREMONT, CA: In recent years, artificial intelligence (AI) has gained momentum with an increase in its utility, complexity, and sophistication. It is already helping businesses across verticals to understand the intricate patterns and consumer behaviors. Simultaneously, AI can also help in the management of the limitless collection of unstructured data.
On similar lines, AI tools and technologies aids in tax collection and compliance. It impacts every phase of the process, from filing tax returns to the tools corporations deploy to comply with the relevant laws. Here are the ways through which AI is transforming the tax and related processes:
AI-Driven Tax Expertise
Currently, the prominent examples of AI in tax transformation are the various online tax tools that are enabling the individuals to fill out their returns. H&R Block, national tax preparation firm started using IBM’s Watson AI system for its tax questionnaire in 2017 that aims to identify tax credits and possible deductions as per the user response.
AI is suited for the task as it can mine the tax data from a company’s tax returns records and compare it against the labyrinthine tax code.
Business Tax Compliance
Enterprises are also investing in AI tax solutions to reduce their loads during the tax season while help with taxes enables them to ensure the legal compliance of the business. Especially for large corporate firms, accurate tax remittance and compliance requires them to deal with complicated regulatory and enforcement structures. AI systems are useful in document review and automate tax compliance procedures.
The Internal Revenue Service (IRS) Explores AI
Recently, the IRS has started to explore the capacity of AI systems in identifying the tax dodgers. According to IRS, underreporting of income by companies and individuals costs them about $450 billion each year.
Apart from identifying the Dodgers, the IRS is also considering AI tools for their database protection that contains financial data of millions of taxpayers.
Taxes, Death, and AI
AI systems will eliminate the anxiety involved in the tax season and will make it convenient for the tax collectors to track the defaulters. The future with AI technology will actualize a tax system where AI systems can manage the bulk of the processes.