It is April 30, 2026. The IRS has noticed a trend of LLCs claiming “Employee Retention-style” credits for what are actually automated AI agents.
- The Rule: Tax credits and deductions related to “Human Capital” require a valid Social Security Number (SSN) or ITIN.
- The Fraud Flag: Claiming payroll tax deductions for “Virtual Assistants” that don’t have a legal persona is now a top-tier audit trigger.
- The Shark Insight: “You can’t have it both ways. You can’t replace 10 humans with AI and still try to claim human-based tax incentives. Be transparent in your Article #626 filings: disclose your AI compute costs as ‘Equipment,’ not ‘Payroll’.”