It’s no secret that Department of Government Efficiency (DOGE) and other Trump administration efforts to scale back the size of the Internal Revenue Service is likely to make tax cheating easier.
Reports on tax personnel terminated earlier this year show that almost a third of lost staff were revenue agents, the IRS employees who conduct audits.
But some Republican members of the House tax-writing committee say artificial intelligence (AI) can help fill this tax examination gap.
Ways and Means Vice Chair Rep. Vern Buchanan of Florida, and W&M Oversight Subcommittee Chair Rep. David Schweikert of Arizona on Aug. 19 introduced the Digital Evaluation for Tax Enforcement and Compliance Tracking (DETECT) Act of 2025.
The bill, officially H.R. 4974, calls on the Government Accountability Office (GAO) to study AI-assisted tax fraud detection. The GAO would be required to report its findings to the Ways and Means and Senate Finance committees within 180 days after the bill’s enactment.
Building on existing efforts: DETECT Act sponsors say the measure will help the IRS’ already “growing momentum in cracking down on tax fraud,” as well as strengthen agency enforcement capabilities.
The lawmakers cited IRS Criminal Investigation (IRS-CI) efforts that in 2020 identified $2.3 billion in tax fraud through 1,598 investigations. Those cases resulted in 945 prosecution recommendations and 593 sentencing actions.
Four years later, IRS-CI success had increased. The tax agency’s investigative arm launched 2,667 investigations, secured 1,571 convictions, uncovered more than $9.1 billion in tax and financial fraud, and recovered nearly $3 billion through restitution and asset seizures.
The DETECT Act, said Buchanan in announcing the bill, will build on this progress and “help the IRS take its efforts even further by evaluating how artificial intelligence can enhance fraud detection and improve recovery of taxpayer dollars.”
Signing on as original cosponsors were GOP Reps. Aaron Bean of Florida, Randy Feenstra of Iowa, Nathaniel Moran of Texas, Adrian Smith of Nebraska, and Claudia Tenney of New York.
AI already being used by IRS: While the DETECT Act offers a new group of supporters of high-tech tax enforcement efforts, the IRS actually has been using AI for years.
The Treasury Inspector General for Tax Administration (TIGTA) recently looked into how the IRS could leverage AI in tax filing examinations, and found that the agency has been using the technology in some form since 2017.
Plus, noted the TIGTA report released May 19, the IRS used additional funding provided under the Biden administration’s 2022 Inflation Reduction Act to strengthen its enforcement efforts, including through “cutting-edge technology, data, and analytics.”
AI shows “substantial promise” for improving IRS examination efforts and closing the estimated $688 billion annual Tax Gap, according to the TIGTA. Its report suggested the IRS use its examination results to improve return classification and return selection AI models that could potentially identify new areas of noncompliance.
Counter to prior GOP IRS actions: This so-far small group of Capitol Hill Republicans, however, seems to be bucking the trend within their party.
TIGTA’s IRS/AI report noted that the GOP Congress clawed back much of the Inflation Reduction Act funding that was being used, in part, for technology upgrades within the tax agency.
As for new dollars, the Financial Services and General Government appropriations bill released July 20 would reduce IRS enforcement funding by more than 45 percent for fiscal year 2026.
That Republican appropriations action aligns with the White House’s fiscal 2026 budget request, which also called for slashing the IRS operating budget, notably when it comes to enforcement funding.
Tax Felon Friday: All efforts, large or small, to ensure that all legally due taxes are properly and efficiently collected deserve praise.
So, the interest of an admittedly small group of Republican members of Congress to boost IRS enforcement efforts by using AI earns this week’s Tax Felon Friday recognition.
At the ol’ blog’s special Tax Felon Friday page, you can read more on all sorts of tax miscreants, from those just charged and/or indicted to those convicted and/or confessed and sentenced, that the IRS has nabbed using high tech and old fashioned crime fighting techniques.
You also can find additional tax crime posts, notably those that were published long before I gave them a special end-of-week feature moniker, in the ol’ blog’s tax crimes category. You’ll find this post at the top of that collection right now, so just scroll down for more.
You also might find these items of interest:
- The long history, and future of, tax cheating
- Proposed IRS layoffs could cost U.S. $2.4 trillion
- IRS watchdog says AI could make for more productive tax audits
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