By Rick Yandle, Esq., CPA — federal criminal & civil tax defense
There is an old warning about leaving your browser open to a search for "how to hide a body." The modern version is quieter and far more dangerous: the person who, facing a tax problem, opens a chatbot and types out the whole story — what they did, what they failed to report, and what they are afraid the government will find.
That transcript does not disappear. Increasingly, it is discoverable.
A new category of evidence
For most of the history of tax enforcement, the government's proof of intent came from a familiar set of places: bank records, altered documents, a second set of books, the testimony of a bookkeeper or a spouse. Intent — the line between a civil mistake and a criminal act — was almost always inferred, assembled piece by piece from conduct.
Artificial intelligence has introduced something new. When a taxpayer describes their situation to a consumer AI platform, they may be creating a first-person, contemporaneous, written account of their own state of mind. In a criminal tax case, state of mind is very nearly the whole ballgame. Willfulness is the element the government most often has to fight for, and it is the element a defendant's own words can hand over for free.
These conversations are not privileged. A chat with a commercial AI product is not a chat with your lawyer. There is no attorney-client relationship, no work-product protection, and — depending on the platform and the legal process used — often no practical barrier to the government obtaining the logs. Framed around anticipated charges, a "let me explain my situation" session is not strategy. It is a confession with a timestamp.
Why this matters more in tax cases than almost anywhere else
Criminal tax matters turn on knowledge and intent to a degree that few other prosecutions do. A taxpayer who underreports income has not necessarily committed a crime; a taxpayer who underreports income knowing it was required to be reported and intending to evade has. The distance between those two people is measured in mental state — and mental state is exactly what an unguarded AI transcript documents.
Worse, these records are the kind of evidence prosecutors like best: the defendant's own words, in the defendant's own hand, before anyone was managing the message. Juries find that persuasive. So do the reviewing attorneys deciding whether to recommend prosecution in the first place.
You cannot un-say it — but you can stop making it worse
The hard truth is that you cannot time-travel. Bad facts, once created, are bad facts. But the situation is almost never improved by continuing to narrate it to an open internet platform, and it is frequently made much worse.
If criminal tax exposure is even remotely on the table, the better "prompt" is a phone call to experienced tax defense counsel — before another word gets typed anywhere it can be retrieved. Privileged conversations exist precisely so that a person can be candid about a serious problem without that candor becoming the government's Exhibit A.
A note for referring counsel
If you practice criminal defense, family law, or business law and a client's tax problem is drifting toward the criminal, this is a fast-moving evidentiary issue worth flagging early. Clients increasingly arrive having already "researched" their exposure with an AI tool — sometimes helpfully, sometimes catastrophically. The sooner privilege is established and the client understands what not to do, the more room there is to work. I am always glad to consult with fellow attorneys whose clients have crossed into federal tax exposure.
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