26% of Americans used AI to help file their 2025 tax returns, up from 11% the year before, according to Adobe polling cited by CBS News. That rapid adoption is running ahead of regulatory clarity: as CNBC reports, experts say IRS rules do not clearly require professional tax preparers to tell clients when AI is being used on their returns.
Where the IRS Rules Fall Short
The gap between AI adoption and disclosure requirements sits at the center of growing concern. Tax professionals already use AI embedded in preparation software to generate returns, but the question of whether a preparer using external AI tools, such as large language models, must notify clients is unresolved. The IRS has not issued explicit guidance covering that scenario, according to the CNBC report. For households handing over sensitive financial data to a preparer, the lack of a clear disclosure rule means they may have no way of knowing how that data is being processed.
Source: Pexels
Why AI Gets Tax Details Wrong
Even when filers use AI on their own, the risks are significant. Caroline Bruckner, a tax professor at American University's Kogod School of Business, told CBS News that AI on its own is not capable of preparing an accurate tax return. One core problem is that IRS.gov contains outdated information alongside current rules, and large language models can pull from older material and present it as current guidance. "That's where generative AI can really cause problems if you just ask it a general question about deductions," Bruckner said. "It may give you a summary of deductions that are no longer applicable."
The risk is especially real this filing cycle. Major changes under the One Big Beautiful Bill Act, signed into law in 2025, may not yet be reflected in AI-generated responses. Bruckner and Intuit tax expert Lisa Greene-Lewis both said AI can be useful for explaining concepts in plain language, but neither recommends relying on it to actually file a return.
New Law Makes Accurate Filing More Consequential
The stakes of getting a return wrong are higher now because the OBBBA introduced several significant changes that affect household budgets directly. As PBS NewsHour explains, the standard deduction rose to $31,500 for married couples filing jointly, $23,625 for heads of households, and $15,750 for single filers. The child tax credit increased from $2,000 to $2,200 per dependent. Single filers can now deduct up to $1,000 in charitable donations without itemizing, a benefit previously unavailable to standard-deduction filers, and joint filers can deduct up to $2,000.
For itemizers, the state and local tax deduction cap jumped from $10,000 to $40,000, a provision that runs through 2029. Each of these changes creates new documentation requirements. Elena Patel, co-director of the Urban-Brookings Tax Policy Center, noted that the IRS requires receipts for charitable donation deductions, which could catch many first-time claimants off guard.
The IRS also phased out its Direct File program, which had allowed free online filing, and is moving away from paper refund checks. Those two administrative changes alone push more filers toward third-party software or paid preparers, exactly the environment where undisclosed AI use becomes a practical concern.
Source: PBS
What Filers Can Do Now
Bruckner's practical guidance is narrow but clear: AI tools can explain complicated concepts, such as the new no-tax-on-tips deduction, without requiring you to share personal data. But using a chatbot to calculate and file an actual return introduces real risk, particularly when the underlying law changed as recently as 2025 and AI training data may not reflect those updates. Filers using a paid preparer have no current IRS rule guaranteeing they will be told whether AI touched their return.
The PBS report also notes that the OBBBA's complexity has led some experts to recommend professional help even for people who normally file on their own, a recommendation that carries more weight when professional tools themselves may be operating in a disclosure gray zone.
Final Thought: With AI use among filers more than doubling in a single year and new OBBBA rules reshaping deductions, the absence of clear IRS disclosure requirements for AI-assisted preparation leaves households with little visibility into how their most sensitive financial data is being handled.