H&R Block launches AI tax filing assistant ahead of tax season

Tax preparation company H&R Block has unveiled a new conversational AI chatbot called AI Tax Assist to assist taxpayers in the upcoming tax season. This generative artificial intelligence chatbot is accessible through the paid versions of H&R Block’s DIY tax software.

AI Tax Assist enables users to ask questions about tax rules, potential exemptions, and other tax-related concerns. It also directs users to human tax experts for personalized advice, with plans to incorporate AI-powered personalized advice in the future, according to The Verge, which first reported the story.

With this launch, H&R Block joined the trend of companies leveraging generative artificial intelligence to enhance efficiency and reduce expenses during the current global economic downturn.

In a demonstration, the company showcased how users, such as gig workers with complex tax filing statuses, could initiate their tax returns and seek information like deductible business expenses for an Uber driver. The AI provides a list of allowed deductions, allowing users to choose whether to include them in their final filing.

To build trust, H&R Block includes a banner notifying users that the feature is powered by AI and provides sample prompts. The company believes that customer trust in H&R Block plays a significant role in the adoption of this feature. Users are not only told what to do with their taxes but are also provided with information on how tax filing works, including various exemptions and the treatment of assets like cryptocurrency.

Chris Linderwell, Vice President of Consumer Tax Products at H&R Block, emphasized that AI Tax Assist is designed to keep users on H&R Block’s platform instead of turning to Google for tax-related queries. The goal is to empower customers to ask detailed questions, and over time, provide more personalized answers through AI Tax Assist.

“We want to empower customers to ask questions as deep as they want, and over time, we can give more personalized answers to their questions on our platform through AI Tax Assist,” Linderwell said.

While AI Tax Assist is not available in the free version of the app, H&R Block assured that it will not raise prices for subscription tiers that offer access to the conversational AI platform. The company built AI Tax Assist using models from OpenAI and Microsoft, trained specifically on H&R Block’s library of tax laws with input from its accountants, lawyers, and tax professionals. It does not pull information from the internet and aims to mimic the experience of speaking with a human accountant.

Addressing concerns about potential misinformation, H&R Block stated that users can cross-check information with a human expert and highlighted a monitoring team ensuring the model’s accuracy and adherence to its design. Other tax preparation apps, like Intuit’s TurboTax, are also incorporating AI to improve tax filing by identifying missing information and making deduction recommendations.

Despite ongoing efforts by the government to offer direct tax filing software, private platforms like H&R Block and Intuit remain popular choices for many users during the tax season.