Another takeaway: two-thirds of respondents said their tax departments are reactive or chaotic in their approach to technology. This echoes what we heard from respondents in the 2024 Future of Professionals report about with their firms’ sluggish adoption of AI.��

Tax departments’ top challenges

In addition to exploring tax teams’ technology adoption rates, the report examined the biggest challenges they’re facing. Respondents ranked hiring and retaining talent as their top concern.��

Not surprisingly, tax professionals ranked compliance issues around three unrelated tax regulations – Pillar 2, the Global Minimum Tax, and Base Erosion and Profit Shifting (BEPS) 2.0 – as their second, third and fourth greatest challenges.��

Also of note, 51% – up from 47% last year – said their internal tax department is under-resourced. This is noteworthy because companies with under-resourced tax teams are more vulnerable to audits and penalties.����

The report showed that under-resourced departments had an average of $50,000 in penalties versus $20,000 for “about-right resourced” departments. Also, those working in under-resourced departments felt behind their better-resourced peers in minimizing liability as well as avoiding incurring penalties and tax audits.����

New technologies can make a positive impact��

On a positive note, about 50% expect their departments’ tech budget to increase, which may indicate companies’ willingness to modernize their tax functions. In addition, the report found that more tax departments within smaller businesses – those with under $50M in annual revenue – are spending a larger portion of their budget – 25% and up – on technology.������

These findings are encouraging because automating work processes can help improve efficiencies, which is a win-win: it helps tax departments address the talent crisis they’re facing while strengthening productivity. An added bonus is that this automation would enable tax professionals to spend more time on strategic and proactive tasks that could benefit the company.  ��

The report showed that tax professionals, on average, spend 61% of their work time on tactical rather than strategic tasks, such as providing strategic advice or managing projects that add value to the company’s bottom line. New technologies and AI tools – such as Checkpoint Edge with CoCounsel, which allows users to conduct faster tax research – empower tax professionals to spend less time on reactive tasks and dedicate more time to proactive, forward-looking work.��

For more insights on how embracing new technologies enables tax departments to be more valued partners to the business, download the full report.��

This is a guest post from Ray Grove, head of Corporate Tax and Trade, ��������.��

Foundation of enterprise-wide innovation��

Maria Apazoglou, head of AI, BI & Data Platforms, Technology, recalled early efforts to create a GenAI platform within ��������, upon which the company’s GenAI-powered solutions – including – would be built. ��

“Our GenAI platform is designed to democratize access to AI, making it easier for non-technical users to utilize AI effectively,” Apazoglou explained. “In the creation of the platform, we focused on two critical aspects: developing a multi-cloud platform to support various AI models and LLMs, and creating an accessible interface to allow users to self-serve, enabling early experimentation and viability assessment.”��

This approach facilitated rigorous testing by developers and evaluation by subject matter experts (SMEs), ensuring optimal model performance. Today, the platform has 10,000 internal users monthly – equal to 40% of the population of �������� 25,000 colleagues.��

Bridging content and customer needs����

When it comes to responsible AI, human-in-the-loop is critical to �������� strategy, with considerations at every stage of design, development and deployment.����

The company has a team of hundreds of tax and accounting experts – many of whom are attorneys and CPAs themselves. These SMEs are critical to enhancing the quality of the responses produced by the GenAI models and to creating a system that meets customers’ needs. Evaluating results and grading answers is an ongoing and constant process. ��

Catherine Murray, director of Editorial, US Tax & Accounting Commentary, coordinated the SME grading efforts, working with �������� developers to interpret the results. She channeled her expertise in tax law, along with her understanding of customers’ needs, into ensuring that the models provided valuable and accessible responses.����

“Working closely with �������� Labs team to conduct experiments and optimize the solution for large language models was an exciting part of the work,” she said. “Thinking about how customers are going to use the solution to surface our high-quality content was fascinating to be involved in, particularly as GenAI tech is evolving all the time.”��

Melissa Oaks, director of Editorial, Current Awareness, noted the excitement from customers during the alpha and beta testing phases. “Customers were eager to keep the beta version and asked, ‘When can I buy it?’ It’s thrilling to work on something that has such a significant impact on their daily lives,” Oaks remarked. ��

Oaks noted that other solutions on the market rely on “just the tax code or the primary sources, and that’s really not enough to do tax research.” She said: “What I love about this solution is we’re providing professional insights and step-by-step guidance on how to actually go do what we’re saying is the recommended course of action, not just the primary sources. This comprehensive approach sets us apart in the market.”��

Transformative time-savings��

Nancy Hawkins, vice president of Product Management, Research, underscored the product’s potential to alleviate industry pressures: “With current tax staffing shortages, our solution offers crucial time-savings and work augmentation, especially for non-attorney professionals conducting tax research. It’s helping customers gain more capacity, whether for work-life balance or business growth.”��

“The exacting nature of the tax profession means mistakes can have significant consequences, and our customers are hungry for solutions that can bring them time-savings and augment their work,” Hawkins said. ��

Delivering accuracy, efficiency, and simplicity��

Erica Butcher, vice president of Sales & Retention – Strategic Firms, noted the industry’s cautious optimism towards GenAI.�� She said tax professionals are “both cautious and hopeful” about GenAI, and they are looking to the tech to deliver accuracy, efficiency, and simplicity.��

“Overall, we are mainly hearing excitement from customers about the potential for GenAI to support top priorities of improving efficiency and addressing the current talent shortage we’re seeing across tax and accounting,” Butcher said. “We’ve really listened to our customers, and we built this solution with our customers’ feedback and needs in mind to ensure Checkpoint Edge with CoCounsel can deliver meaningful, measurable results.”��

For more on Checkpoint Edge with CoCounsel, visit  or check out .

Now generally available in the United States, Checkpoint Edge with CoCounsel helps tax firms leverage the transformative capabilities of GenAI by using large language models (LLMs) to provide an intuitive interface for tax professionals to pose questions to in everyday language.

Two thirds of customers that took part in the beta program expected Checkpoint Edge with CoCounsel to become their primary method for starting federal tax research upon launch.

“Checkpoint Edge with CoCounsel is an innovative tool that allows the use of a question to get a specific response, plus it provides citations without having to search multiple responses to find an answer to a query,” said Gary Brown, owner and principal at Gary Brown CPA, who was among the customers that took part in the beta program. “This saves significant time by providing a focused response versus a list of multiple responses that need to be sorted through to find the desired result, providing significant time savings for research.”

“Trying to read an entire document for up to 30 minutes and trying to really understand those very minute differences and paragraphs and sub-paragraphs, Checkpoint Edge with CoCounsel will now give us the opportunity to receive this answer in a more simplified and relatable format where we can read it and understand it, see the citations as we need, and provide that answer to a client or internally to our own staff,” said Brent Forbush, managing partner, Forbush & Associates.

Checkpoint Edge with CoCounsel is the latest milestone in the �������� expanded vision for CoCounsel – the professional-grade GenAI assistant – to enable professionals to seamlessly complete complicated work involving multiple products through a single generative AI assistant. The launch follows last week’s rollouts of Claims Explorer, a new generative AI skill in Westlaw Precision with CoCounsel, and CoCounsel Drafting, an end-to-end drafting solution that streamlines and improves the drafting process for legal professionals within Microsoft Word.

For more on Checkpoint Edge with CoCounsel, visit , check out , or read the press release.