Are you old enough to remember doing your income tax filing with pen and paper, where everything had to be done manually and there was plenty of room for errors? Not to mention having to stamp and mail it, then wait weeks for your notice of assessment.
Then came electronic filing, which made life a lot easier. I myself have been doing my own taxes for close to a decade using various tax filing software.
While I still file electronically, there’s now a new layer that makes the process even easier and less error-prone. Like everything else these days, AI and large language models (LLMs) are being used to simplify tax filing. They help reduce mistakes, maximize your refund, and, in many cases, ensure you’re not paying more than you have to.
Ways to use AI to simplify your tax return
There are several ways you can use AI to simplify and make your tax filing more efficient.
Use more than one GenAI tool to compare and verify
First, it’s important to use more than one GenAI tool to reduce the risk of AI hallucinations, where a platform might provide inaccurate advice. In my case, I often have Gemini, ChatGPT and CoPilot (or Claude) open side by side and test them on specific questions. For example, while filing my wife’s business taxes, I noticed that one platform made a small error on a question. By checking the other platforms, I was able to confirm the correct answer.
Categorization and Finding Hidden Expenses
Years ago, unless you were very diligent with tracking expenses, especially as a business owner, you had to go through every receipt and add them up—assuming you didn’t miss anything. Today, if you use a dedicated business account for purchases, you can simply download your statements and let AI analyze them to ensure nothing is overlooked. For example, I used AI to review my 407 ETR toll road trips to determine which ones were business-related based on entry and exit points. This saved me hours of manually sorting through receipts.
Review and error-check your tax return before filing
You can also input your numbers into a GenAI tool to double-check your calculations, flag missing items, and spot inconsistencies—such as mismatches between your income and contributions. By asking simple questions like “Does this tax summary look complete?” or “Am I missing any common deductions for someone in my situation?”, you essentially get a second set of eyes reviewing your return. This helps reduce errors, lowers the risk of audits, and ensures you don’t miss out on potential refunds.
The more you use a specific LLM platform, the better it understands your situation and can assist you over time. While it’s helpful to rotate between different tools for accuracy and verification, it’s important to stick with one as your main source—the one that knows you best and you’ve been using the longest. For me, that’s OpenAI’s ChatGPT. Keep in mind that most reputable tax filing software already include AI tools to make filing easier and more efficient. By taking an extra step and using AI while filing, you can ensure that nothing is missed—especially for those with more complicated returns.