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The Accounting Podcast

When Tax Day Was Party Night at the Post Office — And Why AI Is About to Upend Everything Else About Accounting

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Before tax e-filing took over, April 15th was a public spectacle at American post offices. As Blake Oliver and David Leary discussed on their Tax Day episode of The Accounting Podcast, crowds would gather until midnight, with live entertainment, giveaways, and even Playboy offering “stress relief massages” in pink booths. In Philadelphia, there was a “dunk the IRS agent” booth for charity. Radio stations broadcast live. Fast food chains handed out samples. It was America’s weirdest annual party.

Those days are gone — 94% of returns are now filed electronically. But as the hosts explored in this wide-ranging episode, the accounting profession faces disruptions far more profound than the shift from paper to pixels. Within three years, KPMG expects routine audit testing to have “next to no human beings” doing the work. Hobbyist developers are cloning QuickBooks with AI over a weekend. And a third of workers aren’t even checking AI outputs before they submit them.

The IRS Can’t Keep Up — With Rules or Technology

The profession’s struggles with rapid change start at the top. Just five days before the filing deadline, the IRS finalized which jobs qualify for the new no-tax-on-tips deduction. Podcasters made the cut (Oliver and Leary were pleased), along with tattoo artists, ice sculptors, and golf caddies. Accountants didn’t.

“Five days after they finalized these rules to implement them for our clients,” Oliver noted with frustration. The deduction allows eligible workers to exclude up to $25,000 in tips from taxable income, but mandatory service charges don’t count. “This could be the death of the automatic gratuity,” Leary speculated, since those forced tips won’t qualify.

Meanwhile, Americans are spending 11.6 billion hours completing federal compliance forms — mostly tax returns. The value of that labor? Over half a trillion dollars. “That’s material,” Oliver said, noting it represents a significant chunk of the economy devoted to paperwork.

The IRS’s own modernization efforts tell a cautionary tale. The agency had 126 AI projects running as of last summer, up from just 10 in 2022. But after losing 25% of its workforce, 61% of those projects remain unfinished with no plan to close the skills gap. Even more puzzling: the IRS killed its Direct File program despite it costing only $16 million instead of the estimated $61 million and growing 78% year-over-year. “The program was gaining traction and was less expensive than they thought it was going to be, and yet it got canceled anyway,” Oliver observed.

The Big Four’s Radical Restructuring

While the IRS struggles with basic modernization, the Big Four are racing ahead with AI automation that could eliminate thousands of jobs and upend the billable hour model that has defined the profession for decades.

KPMG is moving fastest. They’re piloting AI systems this summer and deploying them next year for routine testing of transactions like payroll, receivables, and cost of goods sold. “Within 2 or 3 years, routine testing could become the first major audit area with effectively no human audit team directly doing the work,” Oliver quoted from KPMG’s audit chief digital officer. “Next to no human beings.”

The other firms aren’t far behind. PwC’s evidence-matching tool now processes 30 client document types, up from six months ago. EY is testing something even more futuristic: AI audit agents that talk directly to client AI agents to gather documents and prepare workpapers. Only Deloitte is publicly pumping the brakes, emphasizing AI should “augment not replace” human auditors.

The numbers are stark: Big Four leaders expect 20-30% of a typical audit to be fully automated by 2029. KPMG UK is already cutting 440 audit jobs. “I don’t see any other outcome than the Big Four just cutting massive numbers of staff jobs,” Oliver said. “If they do this right… that’s 20 to 30% of their billable hours. What are they going to do? Just raise their rates 20 to 30% to compensate?”

Leary had the line of the episode: “Agents are the perfect accounting firm employees. The partners are going to love them.”

The traditional career path is crumbling too. EY’s talent chief told Business Insider that linear career models are becoming “less relevant” as AI values skills over tenure. Oliver speculated firms might shift from hiring masses of new graduates to recruiting experienced professionals from industry, or moving to an apprenticeship model with smaller, more intensively trained classes.

Everyone’s Building Their Own QuickBooks Now

The disruption isn’t just coming from the top. A Reddit user built a full accounting system that runs inside Claude Desktop — no interface, just chat. You tell Claude what happened, and it updates your books. Another developer cloned QuickBooks Desktop using AI, creating a free open-source alternative. The motivation? “I didn’t want to pay for QBO.”

“You as an accounting firm had control over your tech stack and your clients’ tech stack,” Leary explained. “We’re a Xero shop or a QuickBooks shop… Now your clients are just building their own stuff. How do you as a firm manage this now?”

Oliver’s prediction, based on every past tech revolution: “We will end up with more work rather than less, because it will enable our clients to do way more accounting stuff that we’ll have to clean up.”

On the funded startup side, Juno raised $12 million to build AI tax prep that automates 90% of data entry while keeping CPAs in the loop. The key: transparency over autonomy, with source-to-return traceability and visual validation tools. Artifact launched Omni, which Leary called “a Zapier for accounting firms” — it trains AI agents to use your existing tech stack rather than replacing it.

Meanwhile, legacy players are scrambling. Xero published a blog post claiming to be an “AI native operating system.” Leary counted over 20 buzzwords and read them aloud in a devastating list: “AI native, intelligent SaaS, autonomous finance, system of action…” His verdict: “I don’t think this is written for customers. I think this article is written for the street in an attempt to move the stock price.”

The Quality Crisis Nobody’s Talking About

Here’s what should terrify every firm leader: 35% of workers rarely or only occasionally review AI output before submitting it, according to a Resume Now survey. Eighteen percent trust it straight out of the box. Only 40% review AI output every single time. And 15% use AI at work secretly without telling their manager.

“That should scare you as an accounting firm owner,” Leary said.

Oliver argued firms need systems with built-in controls: “If an employee is just generating something with AI… and they didn’t change anything or they didn’t spend any time looking at it, then flag that.”

The stakes are real. The episode covered two fraud cases that show what happens with weak oversight. A New Jersey preparer filed over 100 false returns seeking $170 million in pandemic credits, getting $55 million before being caught. A Pennsylvania preparer started a new $5.5 million fraud scheme while still on supervised release from a previous conviction.

What Separates Winners from Losers

A Hinge Marketing study of 133 firms revealed a massive performance gap emerging. High-growth firms are growing at 33% annually versus 9.6% for average firms. The difference? High-growth firms spend 9% of revenue on marketing (versus 5% for others), and over 90% use AI for content creation, automation, and research.

“If you have a firm that’s growing at 10% and you want it to grow at 30%, spend 10% of your revenue on marketing,” Leary summarized, though Oliver questioned whether it’s causation or correlation: “Is it just that the firms that are growing really fast have money to burn on marketing?”

The Reckoning Is Here

The accounting profession has always adapted slowly. As Leary noted, “Just ask Xero how it takes decades for them to barely make a scratch into the QuickBooks world.” But this time feels different. The changes are coming from every direction at once — Big Four automation, bedroom coders, funded startups, and clients building their own systems.

The irony is thick. Even as AI promises to make location irrelevant, EY is requiring US tax staff to work in-office 12 days a month. The IRS has 126 AI projects but can’t finish them. Firms are adopting AI while a third of workers don’t even review its output.

For firms willing to invest, experiment, and build proper controls, the opportunity is massive. For those hoping to wait it out, the message from this episode is clear: the profession that gathered at post offices until midnight to file paper returns is gone. The question isn’t whether AI will transform accounting — it’s whether the profession can maintain its core promise of trustworthiness while everything else changes around it.

To hear the full discussion — including the story of a disgruntled worker who burned down a $500 million Kimberly-Clark warehouse over pay disputes — listen to the complete episode of The Accounting Podcast.

AI Agents Now Complete Tax Returns Start to Finish While the Government Can’t Even Audit Its Own Books

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The US government just declared itself insolvent. AI agents are completing tax returns without human intervention. And the accounting profession is caught between these two massive disruptions.

In Episode 481 of The Accounting Podcast, hosts Blake Oliver and David Leary opened with a bombshell that somehow flew under the mainstream media radar. The Treasury Department’s own financial statements show the US is $42 trillion in the red, and that’s before counting Social Security and Medicare obligations. They then dove into an equally seismic shift with guest Kenji Kuramoto, founder of Acuity and newly appointed Managing Partner in Residence at AI company Basis, exploring how artificial intelligence is transforming every corner of the accounting world.

Deficit Spending Just Keeps Going

“It’s official. We are insolvent,” David announced at the start of the episode, referencing the Treasury’s 2024 financial statements. They show $6 trillion in total assets against nearly $48 trillion in total liabilities. That $42 trillion hole doesn’t even include the $88 trillion in unfunded Social Security and Medicare obligations sitting off the balance sheet.

“Imagine a family making $52,000 that owes $1.3 million in a line of credit,” Blake said, putting the crisis in household terms.

Making matters worse, the Government Accountability Office issued a disclaimer of opinion for the 29th consecutive year, essentially saying it can’t even verify the accuracy of the numbers because the Department of Defense has never passed an audit.

“This is the reason a huge number of people voted for Trump,” David said. “They wanted to stop deficit spending, and it just keeps going.”

Meanwhile, AI Is Eating the Accounting Profession

While the government’s books are falling apart, AI companies are racing to automate the work of keeping everyone else’s books together. TaxGPT announced an AI agent capable of completing 1040 returns from start to finish without a preparer touching a keyboard or mouse. The tool works with existing web-based portals and tax prep software, pulling in W-2s, 1099s, and other source documents, then having a review agent double-check everything.

“Why go after tax pros?” David asked. “Just get in bed with the portal companies and go after TurboTax.”

Kenji, who recently joined Basis after selling Acuity and taking a year off, described watching AI agents handle complex accounting work that made him come out of retirement. “I saw an agent handle complex payroll entries like booking the GL entry, creating an accrual because the pay period didn’t align with month-end, posting the reversing entry for the following month, and building a complete set of work papers,” he said. “I saw this last year, and I was like, wait, what?”

The flood of AI announcements kept coming throughout the episode:

  • Ramp launched an accounting agent that auto-codes transactions down to the line-item level on invoices, claiming to save finance teams 40+ hours per month
  • Xero announced a multi-year partnership with Anthropic to integrate Claude AI directly into its platform
  • Canopy launched a bookkeeping module with AI that continuously reviews books and flags issues in real time
  • Double (formerly Keeper) released AI Journal Entries that can handle complex, repetitive entries from source documents
  • BILL announced agents for invoice coding, W-9 collection, and automated vendor payment responses

“Everyone thought we were boring,” Kenji said. “Look at this. All these Y Combinator companies spinning up and fundraising announcements and agents everywhere. Come on. Exciting.”

The Skills Gap Is Already Here

The shift is showing up in real time in hiring data. In 2023, only 18% of accounting job postings mentioned AI skills. Now it’s 30%, a 67% increase.

“The real-world requirement is probably 50%,” David argued. “People are behind on updating their postings.”

But a better question is what happens to the business model. Kenji described how at Acuity, the bottleneck was always people. Plenty of companies needed help with their books, but you couldn’t hire enough accountants to serve them cost-effectively. AI agents break that constraint. One highly efficient bookkeeper might handle 45 to 60 clients today. “Will one person eventually be able to handle 200 clients?” David asked.

The threat isn’t just from other firms. An article on Payments.com found that everyday taxpayers are already using ChatGPT and Gemini to do their taxes before ever talking to a professional. The reason is “speed and simplicity,” David explained. “AI can explain tax concepts, organize the documents, and suggest deductions. These are things they’re not getting from their tax professional.”

Are Tokens the New Billable Hour?

As AI cuts the time needed to complete work, firms are scrambling to figure out how to price their services. Bloomberg Law reported that PwC, KPMG, and RSM are all exploring alternatives to hourly billing.

“This may be the thing that finally gets us there,” Kenji said about moving away from billable hours. “If I just used AI to help me get my work done and I’m cutting down my billable hours, I’m losing revenue.”

“You can bill for tokens,” David suggested, offering a provocative alternative.

He then vented about Earmark’s own token consumption across multiple platforms, including Claude, GitHub Copilot, Retool, ChatGPT, and more. “Two days ago, an automation stopped working,” he said. “We spent five plus people hours trying to increase our tokens and get the automation working again.”

The problem is, token costs are opaque and growing. David introduced two terms gaining traction: “token anxiety,” or not knowing what you’re being charged for, and “AI FinOps,” managing AI costs across platforms.

“There’s an opportunity here for firms to become a token expert and offer it as a service,” David suggested.

Blake’s take was more pragmatic. “It’s better than timesheets, that’s for sure.”

The Window Is Closing

The government that sets the rules can’t even audit its own books while declaring itself insolvent. Meanwhile, AI agents are automating core accounting work at a pace that makes the shift from paper to computers look gradual.

“These agents are actually now becoming a component of our workforce,” Kenji said. “You’ve got accountants and you’ve got agents. This is the future state we’re moving into.”

For practitioners, it’s clear that the tools to dramatically expand your capacity exist right now. But so does the threat of clients going straight to AI and bypassing your firm entirely. The window to adapt is open, but it won’t stay that way for long.

As Blake noted about current AI pricing, “When Uber was new, everything was really, really cheap.” The subsidies won’t last forever. To thrive, firms need to figure out the new economics now, whether that’s value pricing, token billing, or something else entirely. Those that don’t may find themselves as obsolete as the government’s ability to balance its own books.

Listen to the full episode for the complete discussion, including deeper dives into specific AI capabilities and Kenji’s firsthand perspective from inside an AI-native company.

Fake Auditor Conclusions, Fabricated Board Minutes, and the Growing Cracks in Accounting’s Trust Infrastructure

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A compliance startup allegedly sold hundreds of companies fake SOC 2 reports complete with made-up auditor conclusions and board meeting notes that never happened. In Florida, legislators nearly abolished the state’s Board of Accountancy entirely. And AI companies now run ads that sound exactly like QuickBooks marketing copy.

These are just some of the topics Blake Oliver and David Leary tackled in their latest episode of The Accounting Podcast. The hosts dug into stories that show the systems meant to ensure trust in accounting face threats from multiple angles.

The (Alleged) SOC 2 Scandal

“This is wild,” Blake said, thanking a listener for sending him a detailed investigation about Delve, a VC-backed compliance startup. The company allegedly created fake SOC 2 reports at scale, using what the hosts described as a disturbing playbook.

According to a Substack series Blake reviewed, Delve’s platform pre-populated everything from policies to evidence and even independent auditor conclusions. The company then allegedly routed these pre-written reports through audit firms that simply rubber-stamped them.

“These are allegations. I have not independently verified any of this,” Blake was careful to note. “This is a very in-depth Substack report by an anonymous poster. So we should take this with a grain of salt.”

But the details were alarming. The investigation claimed to find board meetings that never happened, security simulations that were never performed, and trust pages showing controls as “implemented” before any actual work was done. Companies had written policies claiming they had mobile device management, VPNs, and intrusion detection systems, even though they had none of these.

The author analyzed 322 public Delve trust pages and found that 321 showed the exact same SOC 2 control set, which seems odd for supposedly customized compliance programs.

“The logo you get is an AICPA logo, right? You’re getting a stamp of approval from the AICPA,” David said, cutting to the heart of the problem. “Is the AICPA checking on all these badges that are on company websites?”

Blake explained how easy it would be to game the system. “All you have to do is find a firm willing to sign off without actually doing the work,” he said, comparing it to the BF Borgers case in Colorado, where a CPA firm was caught signing off on audits it never performed.

“This is the problem with assurance,” Blake continued. “If you have a few bad actors willing to just sign off, sign off, sign off, they can make a lot of money. And how do they get caught? And if they get caught, what happens?”

Florida Almost Killed Its Board of Accountancy

While fake compliance reports threaten the profession from within, Florida’s legislature almost destroyed a key piece of regulatory infrastructure from the outside.

House Bill 607 would have eliminated the Florida Board of Accountancy along with other professional licensing boards as part of a sweeping deregulation push. The Florida Institute of CPAs called it “the most serious threat to the profession in decades.”

“How do you regulate the CPA in Florida?” Blake asked, explaining the stakes. Without a Board of Accountancy, there’s no enforcement mechanism, no oversight, and no one to investigate bad actors.

The bill moved quickly through two committees before being stopped. But victory came at a cost. To focus on defeating the bill, FICPA had to table its own effort to create alternative pathways to CPA licensure that would have allowed candidates to qualify with 120 credit hours instead of 150.

The irony wasn’t lost on the hosts. Florida was the first state to implement the 150-hour rule. Now, while about 30 states have approved alternative pathways, efforts to defend against total deregulation have sidelined reforms.

“We want to streamline licensure, but we don’t want it to go away,” Blake said. “We’ve got folks who want too much regulation, and then we’ve got folks who want no regulation. There’s got to be a middle ground here.”

David predicted this won’t be the last such attempt. “I imagine we’re probably going to see more pushes for this because people are going to want the big, huge AI companies to have their AI do CPA work without a license in the way.”

When AI Ads Look Like QuickBooks Ads

Speaking of AI companies, David discovered something unsettling through a targeted LinkedIn ad. Anthropic is marketing “Claude for Finance” using language that sounds exactly like traditional accounting software.

The ad promised to handle recurring financial workflows, organize receipts into clean spreadsheets, build quarterly revenue models, and cross-reference documents for month-end close.

“Third-party app developers and accountants and CPAs that use Claude essentially trained the model so they could just take everybody out of the middle,” David explained. He compared it to how the iPhone camera evolved. At first, you needed third-party apps for filters and editing. Now it’s all built in.

The hosts also discussed a Wall Street Journal article about how regular people are already using AI for tax work. Examples ranged from using Copilot to model Roth conversions to having AI explain confusing IRS notices. One person used Gemini to value charitable donations for their tax return.

“The takeaway is they’re avoiding getting an accountant or a tax professional,” David said bluntly.

But the technology isn’t perfect. One user found that Grok gave wrong answers about capital gains tax until he rephrased his question. A retired tax preparer tested ChatGPT on an IRS volunteer certification exam, and ChatGPT failed.

This leads to what David called the “fact check tax,” a term from Anthropic’s own survey. “An assistant that sounds sure but is often wrong forces you to treat everything as suspect. Instead of freeing attention, AI creates a permanent fact-check tax.”

The Bigger Picture

These stories paint a picture of a profession under pressure from multiple directions. Fake compliance reports undermine the attestation model. Deregulation efforts threaten the licensing framework. AI platforms are positioning themselves as replacements rather than tools.

As Blake noted about AI, “It’s going to be really hard for Intuit and Xero to keep up unless they’re just plugging into ChatGPT or into Claude. How can their own AI chatbots keep up with what these companies are doing, and how fast they’re developing?”

For accounting professionals, these are challenges that require attention and action. Listen to the full episode of The Accounting Podcast to hear Blake and David discuss these stories and more. 

The Privacy Excuse for Not Using AI in Accounting Just Lost Its Last Leg

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Blake Oliver needed to file a City of Los Angeles business tax return for his last remaining bookkeeping client. Instead of spending 30 minutes clicking through websites and copying numbers, he gave Claude Cowork a single instruction: “Search my email for info about the account and help me file it on the city website.”

What happened next, documented on a recent episode of The Accounting Podcast, shows exactly where the accounting profession stands with AI adoption. The AI agent searched Blake’s email, found the tax notice, extracted the business details from a PDF, logged into the city website, navigated to Xero to pull gross receipts, filled out the return, and drafted the client confirmation email. Total human involvement: one correction when it pulled accrual instead of cash basis numbers.

“This is a task that might take 15 to 30 minutes if you filled out a time sheet. Claude just did it,” Blake told co-host David Leary during their weekly news roundup.

The Numbers Show AI Closing In Fast

OpenAI didn’t just release another model update with ChatGPT 5.4. It specifically targeted the kind of work that fills an accountant’s day. As David read from OpenAI’s announcement, the company “put a particular focus on improving GPT 5.4’s ability to create and edit spreadsheets, presentations, and documents.”

The benchmarks back up that focus. Using something called GDPval—which measures performance on real-world knowledge tasks across 44 occupations—ChatGPT 5.4 now beats or ties industry professionals 83% of the time. On spreadsheet tasks specifically, it jumped from 68% accuracy to 87% in a single generation.

“It’s getting close to that 90% success now on everything,” David observed. For context, that means if you give an accountant and this AI the same spreadsheet task, the AI will match or beat the human’s performance nearly nine times out of ten.

Real Accountants, Real Work, Zero Software Costs

While Blake was experimenting with Claude for business tax returns, a developer went further. Fed up with TurboTax, he used Claude to complete a 42-page federal return plus two trust returns, all at zero software cost beyond his AI subscription.

His approach was surprisingly low-tech: Downloaded blank PDFs from the IRS, have Claude fill them out, then print and mail. The biggest challenge wasn’t getting the AI to do the calculations or understand the tax code. It was trying to make it work with the IRS’s online fillable forms. So he skipped that part entirely.

“The comments were like, ‘Can I quit doing my returns tomorrow? I’ve been waiting for this my whole life,'” David said, describing the reaction from tax professionals who saw the developer’s work on social media.

The timing is notable. These experiments happened during tax season, when practitioners are supposedly too busy to explore new tools. Yet here’s a developer replacing TurboTax with Claude, and Blake casually using an AI agent for client work.

The Privacy Excuse Just Disappeared

Most firms claim they can’t use AI because client data is too sensitive. This week, Zapier offered a solution to the privacy problem.

Its new AI Guardrails can detect over 30 categories of personally identifiable information, redact sensitive data before it reaches AI systems, block workflows when it detects problems, and identify attempts to manipulate the AI. You insert it as a step in any workflow, and it sanitizes the data before AI ever sees it.

“If you have client data being passed through Zapier into any AI tool, go add this step to your workflows,” David advised listeners.

Blake was even more direct about the implications. “I totally see this being a huge tool for accounting firms, because we have all this information we want to use with AI. But a lot of it is too sensitive. That’s the main reason most firms aren’t doing anything with it.”

Beyond AI: The Week’s Other Bombshells

While AI dominated the discussion, Blake and David covered several other major stories that accounting professionals need to know about, including:

The Botkeeper Collapse Gets Messier

In an interview with Accounting Today, CEO Enrico Palmerino claimed the company went from healthy to dead in eight days. But Blake uncovered how Botkeeper engineered its financials by selling their bookkeeping clients to a firm called Benchmark Cloud Accounting. It then had that firm buy a multi-million dollar Botkeeper license. “That is how you turn service revenue into SaaS recurring revenue,” Blake explained.

Iran’s Drone Economics

The cost disparity between Iran’s drones and America’s million Interceptor missiles raises questions about the financial sustainability of current military strategies. “We’re spending $3 million to shoot down something that costs $20,000 to $50,000,” Blake pointed out.

KPMG and Polymarket

Anonymous accounts on the prediction market Polymarket have been suspiciously successful at betting on earnings for companies audited by KPMG- (and only KPMG) audited companies. The amounts are small so far, but as David noted, “Are they doing it on the real derivative markets as well?”

Record 401(k) Withdrawals

Vanguard reports hardship withdrawals have tripled since 2020, jumping from under 2% to 6% of participants. Despite positive business sentiment, individual financial stress is climbing.

What This Means for Your Firm

General-purpose AI agents can complete multi-step workflows across email, accounting systems, and government websites. The privacy barriers that kept firms on the sidelines now have concrete, deployable solutions. The capability exists. The safety tools are live. The only question is timing.

Blake’s Claude experience offers a preview of the emerging division of labor. AI handles the execution, humans provide the judgment. The AI pulled the wrong basis for the numbers. Blake caught it. That’s where professional value lives now, not in the clicking and copying, but in knowing what the AI doesn’t know to check.

The message might seem poorly timed to practitioners overwhelmed by tax season. But accountants are eager for tools that eliminate the drudgery, even in the thick of deadline pressure.

Listen to the full episode to hear Blake walk through his Claude workflow step by step, get David’s take on what ChatGPT 5.4’s benchmarks really mean, and understand why the Botkeeper story matters for anyone considering AI-powered bookkeeping solutions. The episode reflects a profession at an inflection point—not in some distant future, but this week.

A Startup Claims AI Can Do Partnership Tax Returns Autonomously, But Where’s the Proof?

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Can an AI agent really complete a partnership tax return by itself? A two-year-old startup just raised $100 million claiming it can, but the hosts of The Accounting Podcast want to see the receipts.

In a recent episode, Blake Oliver and David Leary tackle the biggest AI claims hitting accounting right now. A startup called Basis says it built an AI that can prepare partnership tax returns autonomously. Intuit mentioned AI 150 times in one earnings call while announcing deals with both OpenAI and Anthropic. And new desktop tools let accountants automate recurring tasks without writing any code.

But that’s not all they covered. Trump’s tariffs were just ruled illegal, setting up a gold rush of refund claims. There’s finally a Senate bill to regulate tax preparers, because believe it or not, there are currently zero requirements. And one tax expert bet his life savings against DOGE and won.

A Billion-Dollar Claim (But Where Are the Receipts?)

The most jaw-dropping news comes from Basis, a startup founded in 2023 that just hit unicorn status. They raised $100 million at a $1.15 billion valuation, with money from Google Ventures and former Goldman Sachs CEO Lloyd Blankfein. The company claims it built an AI agent that can complete a partnership tax return autonomously.

Blake explained why this would be huge if true. “When you use TurboTax and you go through the wizard, it’s basically just taking your information and plugging that into the correct boxes on the forms. Partnership returns are much more complex because your balance sheet has to tie out, and you have to make all these adjustments and basis calculations. It gets really complex with the partners’ different shares of ownership.”

If Basis really pulled this off, accounting firms could skip having staff accountants prep these returns entirely. Everything would go straight to manager review. That’s a massive cost savings.

But David isn’t buying it without proof. “Their whole website’s optimized to raise money from investors,” he said. Until just before the fundraising announcement, Basis had no screenshots, videos, or demos anywhere. Its blog posts focus on the money they’ve raised and internal software development rather than showing how the accounting agents actually work.

“Where is this great blog post showing how they’re doing this return?” David asked.

Basis claims 30% of the top 25 accounting firms are “using” their software. But David, drawing from his Intuit days, knows better. “Using and using are not the same two words. A big accounting firm would buy 2,500 seat licenses for QuickBooks. A year later, they rolled out two to clients.”

Blake’s message to Basis was simple, “If you’re listening, we want to see it.”

Get Ready for the Refund Rush as Trump Tariffs Ruled Illegal

While everyone’s debating AI, there’s real money on the table right now from Trump’s tariffs. The Supreme Court ruled them illegal, and companies are scrambling for refunds.

“Eighteen hundred companies have already filed refund lawsuits against the federal government,” Blake reported. Big names like Costco, Goodyear, Barnes and Noble, and FedEx are in the mix. Through December 10th, at least 301,000 importers were subject to these now-illegal tariffs.

The kicker is Trump immediately announced new 15% global tariffs under a different law. But Blake thinks these are probably illegal too. “We have trade deficits, but we don’t have balance of payments deficits,” he explained. Trump is using a law from the 1970s when the U.S. was on the gold standard. Those conditions don’t exist anymore.

The administration’s own lawyers previously argued companies could get refunds if the tariffs were ruled unlawful. Now they’re stuck with that position. As one viewer commented during the livestream, “Only the richest companies will get tariff refunds, and consumers will get hosed in the end.”

“Offer this as a service at your firm,” David says, offering accountants a business idea. “Spin up a service and help importers get their tariff refunds.”

Intuit’s Playing Every Side of the AI Game

Intuit CEO Sasan Goodarzi mentioned AI about once every 30 seconds during the company’s recent earnings call, a total of about 150 times. But the real story is its strategy of partnering with everyone.

They’re working with OpenAI and Anthropic’s Claude. Plus, they’re building their own AI. David compared it to Microsoft in the late ’80s. “Microsoft was working on Windows. At the same time, they were in bed with Apple working on Mac OS, and they were working with IBM on OS/2. Nobody knew which OS was going to win.”

Intuit’s betting that no matter which AI platform wins, it wins too.

Goodarzi made an interesting point about why AI companies want to partner rather than compete. “Frankly, in some ways, this addressable market is too small for them to even worry about.” Accounting AI is tiny compared to the trillion-dollar AI market. These companies would rather partner with Intuit than build their own accounting platform.

The company claims its AI saves customers 12 hours per month on accounting and 17 to 18 hours a week on financial statements. But David called BS. “I just can’t imagine any small business owner spending 18 hours a week building a P&L or a cash flow statement—maybe one week a year.”

But Blake sees why Intuit will survive. “They have the data. They are the trusted database for accounting, financial, and tax information. Somebody could build a QuickBooks clone, but you’re not going to get everyone to switch.”

The AI Tools You Can Actually Use Today

While companies make billion-dollar bets, there are tools available right now that work. Blake’s current obsession is Claude Cowork, which can access files on your computer and click around your desktop.

“You could say every time a new file is added to this folder, look at it and analyze it and figure out what to do with it,” Blake explained. “Maybe I want you to plug those numbers into some practice management system. Maybe I want you to take that file and create an invoice.”

Blake built his own automation that takes meeting notes from Google, extracts all the tasks he committed to, and automatically adds them to his task list with due dates. “I don’t have to wait around for somebody to have that bright idea. I can just build it myself right now.”

The workforce impact is already showing up. According to a Kantata survey, 87% of professional services firms plan to manage AI agents as part of their workforce. But it’s changing the nature of work. The study found that while AI makes workers faster, people end up taking on more tasks and working longer hours without being asked.

For accountants, you’re either a reviewer or you’re in trouble. “It’s hard to get an entry-level job or a job where you’re the doer,” Blake said. “But if you are a reviewer or manager, if you have experience and you know what you’re looking at, you are super in demand.”

Other Big Developments This Week

Other news Blake and David covered in this episode includes:

  • A Senate bill to regulate tax preparers. There are currently zero requirements to be a paid tax preparer in the US. A new bipartisan bill would let the IRS deny or revoke preparer ID numbers and crack down on ghost preparers who don’t sign returns.
  • SEC considers biannual reporting. Public companies might only have to report twice a year instead of quarterly. Blake likes the idea. “One of the problems in the US is that companies are expected to beat earnings estimates quarter after quarter. It incentivizes them to make short-term decisions.”
  • Washington’s CPA problem. Washington State issued a record 2,086 CPA licenses last year, but 60% went to international candidates. You don’t even need a Social Security number to get a CPA license in Washington. “Is the accounting shortage actually getting solved, or is Washington just becoming a gateway for outsourcing?” Blake asked.
  • The DOGE bet. Alan Cole, senior economist at the Tax Foundation, bet $342,000 of his life savings that the Department of Government Efficiency wouldn’t cut spending. He won $128,000 when the government spent more in 2025 than in 2024. “We were smart enough. We could have done this,” David observed.
  • IRS scam alert. A Michigan man lost over $1 million to scammers claiming they needed to move his money to a “federal IRS locker” for protection. “Send all your clients an email telling them that this doesn’t exist,” David advises accountants. “It’s a good story. Your clients will open it, and it looks like you’re providing value.”

The accounting profession is at a crossroads. AI agents might really be able to do complex tax returns. Legacy software companies are scrambling to stay relevant. And the tools available today are already changing how work gets done.

But as Aaron Harris from Sage pointed out, “Technology shifts faster than customer trust.” And David added, “It’s probably even worse with accountants.”

Want to hear the full discussion, including why IBM lost $31 billion in market cap when Claude learned COBOL programming? Listen to the complete episode of The Accounting Podcast.