Could AI be the Future of Tax Filing?

Filing federal taxes is a stressful activity for many U.S. adults. More than half (57%) of all U.S. adults who file federal taxes find completing their own tax-filing nerve-wracking, according to a recent study conducted by The Harris Poll on behalf of Fast Company. 

Filers care about maximizing returns and may be willing to invest extra time and money to do so. 

For a notable portion, a positive tax filing experience means balancing maximizing tax returns with making the process as convenient as possible. AI could play an important role in helping tax fliers achieve this balance, but there is still doubt on whether the technology is able to consistently help users create accurate filings. Companies introducing AI into their tax filing services will likely need to show customers that this new technology can be trusted. 

In general, federal filers try to tackle their taxes early and often seek the expertise of others. 

Eight in 10 US adults who report that they file federal taxes (79%) state that they typically complete their filing before the late end of the season. Specifically, just under half (46%) of filers say they file their taxes early in the season, and a third (33%) complete their tax filings mid-season. One in five (19%) wait until late in the season or after the initial filing deadline. 

More than half (54%) of filers prefer to file with assistance of someone else In comparison, 44% prefer to complete their filing independently. 

Two thirds (66%) of filers prefer to seek out paid support to complete their filing. Meeting with a professional (33%) is the most frequently cited paid service utilized to complete filings, followed by hiring and online service (22%) and using a paid software (15%). 

Maximizing tax returns is top of mind for most filers. Three in five (60%) disagree that completing their filing quickly is more important than maximizing their filing (e.g., reducing taxes owed, increasing returns), and two thirds (66%) agree that it’s smart for people to use legal loopholes in tax law to maximize their filing. 

AI could soon shake up the filing process but concerns about accuracy will be a barrier. 

Only 17% of filers report having used AI programs to assist with filing, but 45% state that they would consider doing so in the future. Those who have previously filed with the assistance of AI programs note more frequently that they would consider doing so in the future compared to those who have not already done so (91% vs 35%). 

That said, there are still some concerns around using AI to complete tax filings, especially among those who have not used the technology to complete their tax filings before. Six in ten (59%) U.S. adults who file federal taxes (59%) agree that they do not trust AI programs to accurately complete filings. However, this sentiment is largely driven by those who have not used AI (65%, compared to 37% of those who have already used AI programs to file). 

These surveys were conducted online in the United States by The Harris Poll from January 26, 2024 to January 29, 2024 among 1,112 US adults, aged 18+. Figures were weighted where necessary to align with actual proportions within the population. For additional information, please contact The Harris Poll.