Sponsors (4)
The bill pilots AI to find and recover improper tax payments—potentially saving money and improving fairness and oversight—but it raises meaningful privacy, error (false‑positive), and administrative‑burden risks and requires funding to implement.
Taxpayers: A pilot using AI to detect fraud could reduce improper refunds and recover funds, potentially saving taxpayer dollars and lowering the deficit.
Taxpayers (especially low-income filers): Better detection of abuse could improve fairness so honest, compliant filers are less likely to bear the costs of fraud.
Taxpayers/Congress: Requiring a GAO report on AI accuracy and aggregate recoveries increases oversight and provides evidence for future policy decisions.
Taxpayers: Automated analysis of sensitive tax data raises privacy and surveillance concerns about how data is processed, stored, and protected.
Taxpayers (particularly low-income filers): Use of AI to flag returns could produce false positives, risking incorrect assessments, delays, or burdensome follow-ups.
Small-business owners and third-party preparers: Increased scrutiny of flagged returns could create additional compliance costs and administrative burdens.
Based on analysis of 2 sections of legislative text.
Requires Treasury to run an AI pilot to detect inaccurate or fraudulent tax returns and requires a post-pilot Comptroller General report on fraud, recoveries, and tool accuracy.
Official title: To require the Comptroller General to submit a report to the appropriate committees of Congress on the potential of artificial intelligence to assist the Internal Revenue Service in detecting tax fraud.
Introduced June 29, 2026 by Vernon G. Buchanan · Last progress June 29, 2026
Requires the Treasury Secretary to set up a pilot program using artificial intelligence to identify inaccurate or fraudulent tax returns, including identity-theft returns, improper credit/deduction/refund claims, and returns prepared by unidentified third parties. The pilot must begin within 180 days of enactment, run between 18 months and 2 years, and be followed by a Comptroller General report on fraud detected, recoveries, and AI accuracy. The law establishes timing and reporting rules only; it does not itself change tax rates, penalties, or expand enforcement authorities beyond creating the pilot and the required GAO-style evaluation.