Just like Baskin-Robbins and Dunkin’: Palantir & the IRS are two unholy alliances.

I utilized AI to create an image detailing the unholy alliance between Dunkin' and Baskin Robbins, and I feel like it fit the bill. 

The Exam function of the IRS is the section of the IRS charged with auditing, or “examining” tax returns. 

When your tax return is processed, the IRS has historically given your tax return a three digit score. This score is called a DIF (Discriminatory Index Function). The way the score is calculated is shrouded in secrecy, and only IRS employees with the highest security clearances understand the entirety of the function, and how it is calculated. 

Enter Palantir. 

Since 2014, they have been engaged with the IRS to refine how the IRS collects data to ascertain whether or not filed tax returns are indicative of reality. Over $200 Million has gone to Palantir, according to WIRED Magazine. 

Historically, a tax filed tax return is electronically processed and then is “classified” at a particular IRS campus situated throughout the United States. This classification process is where generally, but not always tax returns with a certain DIF score are kicked out for a human at an IRS campus to determine if it should be audited, and what issues should be looked at. 

Now, according to a public records request by WIRED magazine, Palantir has created a program with the IRS called SNAP, or “Selection and Analytic Platform” designed to streamline how the IRS identifies potential fraud cases. 

Currently SNAP is focused on three areas:

1. Disaster Zone Claims

2. Residential Clean Energy Tax Credits

3. Form 709 Gift Tax returns

If your tax returns involve any of these three items, there is a chance that the Palantir driven "SNAP" tool may have analyzed your tax return. 

This brings to light a deeper trend:

AI tools are already being adopted to turbocharge IRS auditors. 

Can your tax returns take the heat of an audit?

At ustaxresources.ca we have Canada’s only former IRS Revenue Agent. If you are an expat with unfilled returns, or simply want peace of mind: reach out to ustaxresources.ca to get started.