Musk's xAI fails to pay staff $420 for giving their tax returns to Grok

Elon Musk's xAI asked employees earlier this year to offer up their own tax returns as training data for the company's Grok chatbot, promising a $420 payment as incentive for doing so. Two months later, those payments still haven't materialized.

XAI, which is in the midst of a broad overhaul, made the offer to employees to collect more data that could improve Grok's tax capabilities ahead of the April 15 US tax deadline, according to internal chats seen by Bloomberg News. Americans were already turning to rival chatbots like Anthropic PBC's Claude and OpenAI's ChatGPT to handle accounting work, and xAI was rushing to compete for a slice of the market. 

In March, managers at xAI offered employees the cash payment in exchange for completed tax filings, according to the chats. Volunteers had to submit completed tax filings as well as supporting documents and materials from this year or the year prior, the messages show. In exchange, they were promised early access to X Money, the payments platform Musk is building into the X social network, as well as a $420 payment — a marijuana reference Musk uses often. 

Soon after, the call for volunteers was broadened to include employees' family and friends who had used an accountant, not AI, to prepare their taxes. They were also promised a payment. XAI also looked into hiring accountants and data annotators to train Grok on doing taxes, and Musk encouraged users online to get higher refunds using the chatbot.

Two months after handing off their personal financial data, the bonus still hadn't arrived, the chats show. Some staffers who have asked about the payment have been told that the manager in charge of the program is no longer working there, people familiar with the matter said. A spokesperson for xAI did not respond to a request for comment. 

The unfulfilled payments promise has provided another knock to morale inside xAI, which has been through layoffs and several management changes since the start of the year. Musk is working frantically to improve the company's business and products before his rocket company SpaceX, which now owns xAI, goes public later this year. XAI has also been trying to catch up with competitors, including Anthropic, which have developed chatbots for specific use cases, such as financial modeling. 

To keep pace, Musk has turned to staffers for data, inked deals with other companies like Cursor for coding, and relied on SpaceX leadership for management. But changes and constant employee turnover have still left initiatives, like the payments offer for tax data, unmanned. 

This is not the first time Musk has relied on workers for valuable training data. Late last year, xAI managers encouraged employees to provide data for a software project known as Macrohard, named as a play on Microsoft Corp., that aims to use AI to replicate an entire company using AI agents. Personnel were promised a 20% bonus if they recorded their screens and fed their activity to Grok, people familiar with the matter said. Those payments were eventually made but also took a while to process, the people added.

Macrohard is now a joint venture with Tesla Inc., and the car company's Ashok Elluswamy, a VP of software, is hiring people for the project.