Using AI to catch tax noncompliance
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Every industry is talking about how to leverage artificial intelligence, and tax agencies are no different! In the last several months, we’ve noticed lots of discussion about how authorities could use AI to not only automate their operations but actually help enforce tax laws. At the moment, the two areas discussed are: reviewing tax returns and running tax audits. The idea is that AI models could help detect noncompliance and other suspicious behavior.
For some folks, the idea of national tax agencies using AI raises immediate concerns about privacy and data security, because the models are not yet fully sealed. “Data leaks” could be a real risk to citizens and businesses. Other folks have raised the issue of bias in AI, which tends to mirror unjust cultural biases that exist in wider society. Could the model start targeting particular people?
For now, the United States IRS is already using AI to do exactly that! Their target? The rich and powerful. Read on about how they’re using AI and other tools to crack down on wealthy potential tax violators.
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???What is a tax jurisdiction?
Tax jurisdictions are the building blocks of tax liability. They determine which rules and policies your business must follow – including when to register, what rate to charge, and when to file.
When you run a growing business, it can be hard to learn all the ins-and-outs of tax compliance, not to mention staying on top of all the rules, registrations, and deadlines as the year goes on.
That’s why we’re covering the basics with this post on what a tax jurisdiction is and how it affects your business.
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