The IRS office that disciplines tax preparers just put out formal guidance on artificial intelligence, and the headline is one sentence: AI is a tool, not a substitute for a professional actually looking at your return. That sounds obvious. It’s not — plenty of preparers are already running client returns through AI tools with a lot less human review than that guidance assumes, and now there’s an actual rulebook, with actual discipline behind it, saying that’s not good enough.

The IRS’s Office of Professional Responsibility — the body that enforces Circular 230, the rules every enrolled preparer has to follow — issued a bulletin this summer walking through exactly how those existing duties apply to AI. Due diligence, competence, and confidentiality didn’t get rewritten. They got pointed directly at AI use, and the message was blunt: “final decisions must always rest with qualified professionals,” and AI-generated content is “a starting point, not a finished product.” A preparer can’t hand you a return that an AI tool drafted and call the review done.

Here’s what that actually requires, in plain terms. A preparer has to personally verify every fact, every number, and every citation an AI tool produces before it goes on your return — not skim it, verify it. They have to actually understand the tool they’re using well enough to know where it tends to make mistakes, because “I didn’t know the AI would do that” isn’t a defense under these rules. And there’s a billing rule that should matter to you directly: if AI let your preparer finish your return faster, the IRS says that time savings has to show up in what you’re charged — padding a bill for hours the AI actually did the work in is now flagged as a potential “unconscionable fee” violation.

The confidentiality piece is the one that should actually worry you if your preparer is cutting corners. Your tax return has your Social Security number, your income, your bank information — real, protected data. The bulletin specifically warns that public or unsecured AI tools can expose that information, and it requires “secure, enterprise-approved AI” only. If your preparer is pasting your tax documents into a free consumer chatbot to save time, that’s not a hypothetical risk anymore — it’s a Circular 230 violation waiting to be found.

Curious how a return actually gets prepared before it goes out the door? Ask. Any preparer worth using should be able to tell you plainly what tools they use and how they check the work. Book a call and I'll walk you through exactly how I handle it.

The IRS bulletin isn’t hypothetical about what happens when this goes wrong, either. It points to real cases of attorneys getting sanctioned — financial penalties, public censure, thrown off cases — for filing documents with AI-invented citations that turned out not to exist. It also flags a case where an accounting firm produced a government report with fabricated quotes generated by AI, which cost the firm a chunk of its fee back. The IRS’s point in citing those cases: the same risk exists in tax practice, and preparers who don’t personally verify what AI hands them are one bad citation away from the same outcome.

I’ll say plainly where I land on this. I’ve been doing this for over 30 years, and every return that leaves my office, I’ve been through it myself — line by line, not a rubber stamp on whatever software spit out. AI tools have real uses in this business: pulling together research faster, catching patterns across a big set of documents, drafting a first pass at something I still have to check. What they don’t get to do is make the final call on your return, and they definitely don’t get to touch your Social Security number without me knowing exactly where that data is going. That’s not a marketing line — it’s what the IRS just told every preparer in the country is now the actual, enforceable standard.

If you already have a preparer, it’s a fair question to ask them directly: do you use AI, and what do you personally check before my return gets filed? A good answer is specific. A vague one is worth paying attention to — this is the same year the IRS itself is running AI models against your return on the audit side, so the last thing you want is AI-driven mistakes on the way in and AI-driven scrutiny on the way out.

If you've wondered whether AI tools are safe to use with your own tax information, or how much a preparer should be relying on them, I've written about both sides of this. Here's what's actually safe to share — and reach out if you want a straight answer on how your return gets handled.

This post is general information, not a review of any specific preparer's practices. Ask your own tax professional directly how they use AI tools and what they personally verify before filing. Geiger Tax & Accounting, Amityville, NY. (631) 532-5622 · info@geigertax.com · Client portal: geigertax.taxdome.com