Benjamin Alarie (Osler Chair in Business Law, University of Toronto; CEO, Blue J Legal) et al., Will AI Replace Tax Practitioners?, 181 Tax Notes Fed. 855 (Oct. 30, 2023):
In the evolving legal landscape created by the advancement of artificial intelligence, we confront a worrying question: Will tax practitioners eventually find themselves sidelined by this technological revolution? There is no denying that AI’s capabilities can expedite many of the core tasks we tax professionals perform, potentially pushing our traditional roles toward obsolescence and prompting a sea change in how professional services firms operate. Yet we should recognize the intrinsic value tax practitioners bring — our ability to negotiate, the human touch of empathy, the ethical compass, and the ability to make complex inferences and connections between various tax provisions. These aspects reflect a nuanced art not (yet) replicated by machines. Moreover, a pure reliance on AI is not without potential pitfalls. That reliance risks reinforcing preexisting biases, poses privacy challenges, and could undermine the fidelity of tax planning. Ultimately, we envision a future in which tax practitioners will be instrumental in shaping AI tools and regulations in the tax context. It is not so much that tax practitioners will be replaced by AI but that tax practitioners who leverage AI will outpace and displace those who choose not to adopt it.
Few questions have captured the imagination of professionals and policymakers as intensely as the prospect of AI usurping human roles in complex fields. At the forefront of this discourse lies the tax profession, intricately woven into the fabric of economic systems and societal structures. AI’s capability to automate and enhance tasks performed by tax practitioners presents a compelling vision of a future in which the intersection of technology and human expertise could redefine the tax law and policy landscape. This installment of Blue J Predicts embarks on an exploration of this pivotal transformation. We examine how AI has the potential to upend the status quo, the current inherent limitations of technology that underscore the irreplaceability of human tax practitioners (for now), and the emerging paradigm in which collaboration between humans and machines will elevate the standards of the profession. ...
Conclusion
The trajectory of the tax profession is indelibly influenced by AI advancements, highlighting a narrative of evolution and synergy rather than replacement. AI augments the capability of tax practitioners, enabling enhanced accuracy, efficiency, and foresight in service delivery. The enduring necessity for nuanced legal interpretation, personal client relations, and ethical considerations solidifies the continued relevance of humans in the field. However, an inevitable transformation is on the horizon. Tomorrow’s tax practitioner will leverage AI rather than contest it, and adaptive practitioners who integrate AI will replace those who resist. As we venture forward, embracing this new frontier will be imperative for those seeking to remain at the forefront of the industry.
Blue J Tax Notes Federal articles:
- An Unprofitable Pretax Venture Can Still Be a Partnership, 171 Tax Notes Fed. 1951 (June 17, 2021)
- Economic Substance Doctrine: Still Giving Perrigo Heartburn?, 172 Tax Notes Fed. 599 (July 26, 2021)
- Captive Insurance Appeal in Reserve Mechanical Will Likely Fail, 172 Tax Notes Fed. 1431 (Aug. 30, 2021)
- Seventh Circuit Affirms Spouse Is Not So Innocent on Appeal, 172 Tax Notes Fed. 2149 (Sept. 27, 2021)
- Would Management Fees by Any Other Name Still Be Deductible?, 173 Tax Notes Fed. 499 (Oct. 25, 2021)
- Battling Uphill Against the Assignment of Income Doctrine: Ryder, 173 Tax Notes Fed. 1253 (Nov. 29, 2021)
- Predicting Worker Classification in the Gig Economy, 173 Tax Notes Fed. 1733 (Dec. 20, 2021)
- Using Machine Learning To Crack The Tax Code, 174 Tax Notes Fed. 661 (Jan. 31, 2022)
- Using Machine Learning to Evaluate the Existence of a Trade or Business: Olsen, 174 Tax Notes Fed. 1231 (Feb. 28, 2021)
- Timing Is Everything: The Step Transaction Doctrine in GSS Holdings, 174 Tax Notes Fed. 1849 (Mar. 28, 2021)
- The Debt-Equity Distinction and Tribune Media, 175 Tax Notes Fed. 593 (Apr. 25, 2022)
- Disguised Distributions and Management Fees: Aspro Revisited, 175 Tax Notes Fed. 1401 (May 30, 2022)
- Reserve Mechanical Microcaptive Insurance Arrangement Denied On Appeal, 175 Fed Tax Notes 2037 (June 27, 2022)
- Situational Awareness: Accurate Financial Recordkeeping and Business Deductions, 176 Tax Notes Fed. 713 (Aug. 1, 2022)
- Deducting Legal Expenses: Unpacking the IRS's Appeal In Mylan, 176 Tax Notes Fed. 1419 (Aug. 29, 2022)
- Tax Credits That Bond a Partnership: Revisiting Cross Refined Coal, 176 Tax Notes Fed. 2069 (Sept. 26, 2022)
- Chemoil: Economic Substance, Tax Credits, and Unprofitable Ventures, 177 Tax Notes Fed. 719 (Oct. 31, 2022)
- Cashaw: Conflicting Duties And The Trust Fund Recovery Penalty, 177 Tax Notes Fed. 1257 (Nov. 28, 2022)
- The Rise of the Robotic Tax Analyst, 178 Tax Notes Fed. 57 (Jan. 2, 2023)
- The Intersection Between Tax Credits And Trade Or Business, 178 Tax Notes Fed. 689 (Jan. 30, 2023)
- Relief of Innocent Spouses — Not So Podlucky, 178 Tax Notes Fed. 1339 (Feb. 27, 2023)
- Overcoming Accuracy-Related Penalties With Reasonable Cause, 178 Tax Notes Fed. 2145 (Mar. 27, 2023)
- Unbridled Losses: Harnessing Machine Learning for Tax Analysis, 179 Tax Notes Fed. 637 (Apr. 24, 2023)
- The Rise of Generative AI for Tax Research, 179 Tax Notes Fed. 1609 (May 29, 2023)
- Conflicting Duties And The Trust Fund Recovery Penalty In Cashaw 179 Tax Notes Fed. 2197 (June 26, 2023)
- The Ethics Of Generative AI In Tax Practice, 180 Tax Notes Fed. 785 (July 31, 2023)
- Implications Of The Legal Singularity For a Tax Professionals, 180 Tax Notes Fed. 1455 (Aug. 28, 2023)
- Automated Tax Planning: Who’s Liable When AI Gets It Wrong?, 180 Tax Notes Fed. 2297 (Sept. 25, 2023)
