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Chat GPT: IRS Friend, Foe, or Both?

By John D. Crowder on July 12, 2023
    Undoubtedly one of the hottest topics of 2023 has been ChatGPT and what role it can play, or should it play, in the workforce. Whatever your thoughts, precaution is an absolute necessity as it relates to tax and IRS matters.
    On May 1, 2023, a group of Senate Finance Committee members wrote a letter to the IRS Commissioner warning of the dangers posed by scammers using ChatGPT to create fake IRS messages. The letter also asked the Commissioner what the IRS was doing to combat the use of AI in scams.

    Generally, everyone appears to be asking the right questions. But has anyone asked ChatGPT what it thinks? Whether for the sake of curiosity, amusement, or both, I wanted to give ChatGPT an opportunity to speak on its own behalf and suggest precautions taxpayers can take to avoid being duped by scammers.

Unedited ChatGPT Response

    “As tax season approaches, it is important for taxpayers to remain vigilant and aware of the potential threats posed by scammers looking to steal their personal and financial information. In recent years, scam messages claiming to be from the IRS have become increasingly sophisticated and difficult to detect. Now, with the advent of artificial intelligence (AI), scammers have even more tools at their disposal to create convincing and deceptive messages.

    Recently, a bipartisan group of Senate Finance Committee members sent a letter to IRS Commissioner Daniel Werfel expressing concerns about the use of AI to generate fake IRS notices. One of the primary concerns is the use of AI language models like ChatGPT to create messages that mimic human-like language, making it difficult for taxpayers to distinguish between real and fake messages.

    In previous years, scam messages were often easy to detect due to errors and incorrect references to the tax code. However, AI-generated messages can provide professionally composed messages that appear to be legitimate, making it more difficult for unsuspecting taxpayers to detect the fraud.

    These AI-generated messages often include threats of legal action or penalties and instruct the taxpayer to provide personal and financial information in order to avoid further consequences. Once the scammers have this information, they can use it for fraudulent activities such as opening credit accounts, applying for loans, or filing fake tax returns.

    It is important for taxpayers to remember that the IRS will never initiate contact through email, text messages, or social media platforms. All official communication from the IRS will be sent through the U.S. Postal Service. If you receive an unsolicited message claiming to be from the IRS, do not click on any links or provide any personal information.
  • To protect yourself from these threats, it is recommended that you take the following precautions:
  • Always be cautious when receiving unsolicited messages, especially those claiming to be from the IRS.
  • Never provide personal or financial information to anyone claiming to be from the IRS without first verifying their identity.
  • Check your credit report regularly for any signs of fraudulent activity.
  • If you are unsure whether a message is legitimate, contact the IRS directly to confirm.
    In conclusion, the use of AI to generate fake IRS notices is a serious threat to taxpayers' personal and financial security. It is important for taxpayers to remain vigilant and take necessary precautions to protect themselves from identity theft and financial fraud. By staying informed and cautious, you can help protect yourself and your finances from these threats.”

Author’s Reply to Chat GPT Response
    ChatGPT’s warning to taxpayers is a keen reminder that new technology almost always presents the possibility of nefarious uses of that same technology. However, the same technology can often be used to thwart bad actors while also bringing significant value to society. What the U.S. government plans to do to thwart these bad actors is yet to be fully determined, but it will likely involve the use of a similar technology. No matter the case, if taxpayers receive a notice that might be from the IRS they should consider reaching out to the IRS for verification or contact their friendly neighborhood tax attorney.

If you have questions about this blog or any tax-related matters, please feel free to contact me at jcrowder@meadowscollier.com.