IRS Halts AI Program: Tax Refunds and Office Changes Could Impact Taxpayers
The IRS has temporarily paused its artificial intelligence (AI) modernization efforts, potentially impacting tax refund processing and customer service operations.
Man outside IRS headquarters
Key Changes and Impacts:
- The IRS is reevaluating its use of AI for return processing, fraud detection, and tax filing management
- Treasury Secretary Scott Bessent maintains confidence in AI's potential despite the pause
- Manual processing may cause unexpected delays in refund processing
- The IRS assures taxpayers can continue filing returns as usual
Additional Developments:
- Acting chief counsel William Paul faces demotion amid Department of Government Efficiency (DOGE) data access concerns
- DOGE's planned federal office lease terminations could reduce in-person IRS services
- Hundreds of IRS office closures are expected, limiting taxpayer resources for refund issues and audits
Solutions for Taxpayers:
Electronic filing options remain available and recommended:
- Direct File system
- IRS Free File program
- Direct deposit for fastest refund processing
While the IRS works through these changes, taxpayers should prepare for potential:
- Extended processing times
- Increased refund scrutiny
- Reduced access to in-person services
- Longer wait times for dispute resolution
The electronic filing options continue to be the most efficient way to file returns and receive refunds, despite the ongoing organizational changes at the IRS.
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