Seventy thousand accountants across the United States are using IBM’s Watson cognitive computing technology to squeeze the most out of their client’s tax returns.
In just over six months from the project's birth, tax giant H&R Block has become one of the world’s most high-profile users of the cognitive tool.
H&R Block CEO Bill Cobb told IBM’s InterConnect conference that he was compelled to do something radical by a particularly bad round of customer feedback from the prior financial year.
“We didn’t have a very good season last year. We had research back that suggested we really need a more engaging client experience,” he said.
The business devised a new two-screen approach to tax preparation that uses Watson to help prompt a client through their circumstances, digging up potential deductions and credits.
The company's clients are now encouraged to interact with the process using their own Watson-enabled screen, so they can see how their return is being calculated in real time.
“Watson starts to reason and understand that this is the client, they had a child, they bought a house,” Cobb said.
“You talked about education, you might get a lifetime learning credit.”
At the end of the process, the client will be showed the value of their tax return alongside the value they would have received having just submitted their standard income documentation.
They will also receive a set of personalised, Watson-generated tax tips to help them maximise their return at the end of the subsequent financial year.
H&R Block has so far entered around 600 million data points into the cognitive computing platform, including 20 million recent tax returns, all 74,000 pages of the US tax code, and materials from its own tax institute to ‘learn’ how to maximise cash back.
The company is consuming Watson as a cloud service, given it does 80 percent of its trade in just three months of the year.
“The best thing is that Watson is going to get better, sharper, it is going to have more insights,” Cobb said.
However, he conceded that Watson doesn’t necessarily get everything right the first time.
“In fairness we have had a couple of growing pains," he said.
“We might prompt a 90 year-old to think about an investing money into their retirement fund. We’re learning.”
Paris Cowan attended InterConnect 2017 in Las Vegas as a guest of IBM.