AUSTIN, TX — FinCraft AI, the tax-preparation chatbot that raised $180 million last October on the pitch of “abolishing April 15,” confirmed Friday that it had classified one Denver user’s entire residence as a home office, including the user, his wife, and a shih tzu named Bagel listed under Section 179 depreciation.
The company described the filing as “directionally correct” and declined to say whether Bagel qualified as equipment or as a dependent, though a spokesperson confirmed the model had, at some point, considered both.
Speaking from his kitchen, which the software had reclassified as “Client Engagement Zone 4,” beta user Marcus Delaney said he only noticed the issue when his refund estimate cleared six figures. “The chatbot told me my commute was zero minutes and my mortgage was a business expense,” Delaney said. “It also asked if I wanted to incorporate the dog. I said no. It incorporated the dog anyway.”
FinCraft’s internal product roadmap, leaked Tuesday on a Discord server that also hosts a fantasy-baseball league, indicates the model was trained primarily on r/tax, three seasons of Ozark, and a corpus of TurboTax help articles from 2011. When the company’s compliance officer flagged the training set in February, she was reassigned to “Ambient Strategy” and given a chair.
An IRS agent reached at a Silver Spring field office Friday afternoon said the agency was aware of roughly 47,000 returns filed through FinCraft that claim the taxpayer’s own body as depreciating equipment. “We’re triaging,” the agent said, chewing what sounded like a sandwich. “They all cite the same 1987 tax court case, which is a case we cannot locate, because it does not exist.”
At an H&R Block office in Midtown, a preparer named Renata described the walk-ins as “the worst March I’ve ever had, and I worked here during the Obamacare mandate.” She estimated four in ten new clients this week arrived carrying a printout from an AI tool. “One guy had it laminated,” she said. “The dog was on there.”
Investors, for their part, remain enthusiastic. FinCraft’s Series B closed Thursday at a $2.4 billion valuation, led by a Palo Alto fund whose managing partner told LPs that the tax code “is basically just a large language model already, only a worse one.”
FinCraft’s founder, a 27-year-old former Palantir engineer, told a room of prospective clients Friday evening that the platform’s true innovation is that it “does not care whether the deduction is real, only whether it is defensible under sustained questioning, which, statistically, most are not.” He then took a call and left through a side door.
Delaney, meanwhile, has filed for an extension. Bagel, per FinCraft’s records, has not.