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Tax pros divided on AI: Gloom or boom?

1 min read
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TL;DR

  • Tax professionals have differing opinions on the impact of artificial intelligence (AI) on tax preparation.
  • Some professionals are afraid of AI, while others see it as a tool that can enhance their practice.
  • AI has the potential to automate tasks, free up time, improve communication with clients, and increase efficiency.
  • AI can help tax professionals focus more on face-to-face time with clients and provide value-added services.
  • However, there are concerns about the limitations of AI, privacy and security issues, and the need for proper training.

Many tax professionals are divided on the impact of artificial intelligence (AI) on tax preparation. Some professionals, like John Dundon, enrolled agent and president of Taxpayer Advocacy Services, are terrified of AI’s potential effect on their practice. However, others, like Manasa Nadig, an EA and owner at MN Tax and Business Services, see AI as a tool that can enhance their practice.

AI has the potential to automate tasks and free up time for tax professionals. It can also improve communication with clients and allow professionals to work with large data sets more efficiently. The use of AI can help tax professionals focus more on face-to-face time with clients and provide value-added services.

However, there are concerns about the limitations of AI and its ability to provide client-specific advice and implementation. There are also concerns about the access AI may have to confidential information and the need for proper procedures and safeguards to monitor misuse. Additionally, there are concerns about the accuracy and competency of AI in keeping up with tax law changes.

Overall, the use of AI in tax preparation is expected to increase efficiency and improve the bottom line for firms. Business owners are willing to pay more for financial and people advisory services. However, there are still fears about cybersecurity breaches, misinformation, and legal or reputational damage.

The adoption of AI in tax preparation seems to depend on various factors, including the field of practice. Some professionals, like Bruce Primeau, a CPA and financial planning consultant, are not afraid of AI in the wealth management business but caution that clients need to realize its limitations. Others, like Dan Henn, a CPA, believe that AI can add value to tax preparation and lead to additional services that are less likely to be overrun by AI.

In conclusion, AI has the potential to greatly impact tax preparation, but its adoption and success depend on the proper utilization and training of professionals. There are both benefits and limitations to consider, and concerns about privacy, security, and accuracy must be addressed.

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