Bloomberg Law, Tax Lawyers Must Adapt to AI Now. It’s Already Changed the Game.:
Artificial intelligence is no longer a future issue for tax lawyers. It is already changing how research is done, how large volumes of documents are reviewed, how contracts and motions are prepared, how audit responses are built, and how clients measure value. The profession can argue about whether that change is good or bad. The market won’t care. Tax lawyers have an opportunity to lead the change rather than react to it.
That is the point Spencer Johnson captured in “Who Moved My Cheese,” the 1998 parable about four characters living in a maze and depending on a familiar supply of cheese. When the cheese disappears, two characters rage, wait, and hope the old supply returns. Two others adapt and find new cheese. The lesson is blunt: Change happens; the only real question is whether to move with it or be diminished by it. For tax lawyers, the cheese has moved. …
Proficiency with generative AI tools is rapidly becoming a core competency for tax lawyers. It is also consistent with a tax lawyer’s ethical obligations.
Professional competence includes technological competence. Model Rule of Professional Conduct 1.1 requires lawyers to keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology. That reflects a basic professional reality: Lawyers can’t make informed choices about tools they refuse to understand.
This doesn’t mean adopting every AI product, putting confidential client information into an unapproved open-system tool, or outsourcing judgment to a machine. It means knowing enough to decide when AI can improve the work, when it shouldn’t be used, what verification is required, what confidentiality limits apply, and what human review remains essential.
That understanding takes practice. Lawyers need to learn which prompts work, which tools are reliable for which tasks, where hallucinations tend to appear, how to demand citations, how to test those citations, how to preserve privilege and confidentiality, and how to document the review process. That is what lawyers do when the practice changes.
Responsible AI use is consistent with existing Circular 230 requirements. Section 10.22 (31 C.F.R. § 10.22) requires due diligence in verifying facts, citations, and calculations, and Section 10.36 (31 C.F.R. § 10.36) requires firms to maintain reasonable supervisory functions. Those obligations apply whether the work originates from a lawyer, a paralegal, or an AI tool.
The key insight across all of these frameworks is consistent: The problem isn’t AI use, but unverified AI use. As multiple courts have emphasized, a fake citation is no more acceptable from an AI tool than from a careless associate. The standard of care hasn’t changed. …
Key Takeaways
AI isn’t the end of tax practice. It is a force multiplier for lawyers willing to learn how to use it. It shortens the distance between raw information and legal judgment. It lets lawyers spend less time hunting for the cheese and more time deciding what to do once they find it.The cheese isn’t coming back. The maze has changed. The question is no longer whether tax lawyers should go looking for new cheese, but how fast they are willing to move — and whether they will help lead the profession through the maze.
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