What Tax Professionals Need to Do for a Secure Tax Practice?

Most tax professionals help their clients who have been a victim of a cyberattack, but how many of them know how to protect their clients from all the risks that are lurking in their workplace? Unfortunately, safeguarding cybersecurity isn’t easy, and it gets more challenging if you are dealing with tax data.

There is always a possibility of a data breach. Therefore, it’s important for tax preparers to always be on their ‘A’ game. Steps to reduce tax-related frauds and identity theft are critical. The IRS has indicated that such issues can lead to delays in tax refund processing.

So, how do tax professionals protect themselves and their clients from cyberattacks?

Let’s look at five things tax practitioners can do to make their tax practice more secure.

1. See How You Use Email

Your email can be one of the main risks if you are not careful in its usage. In fact, it is found that nine out of ten viruses come from email attachments. If there is an antivirus installed on your device, most of such emails would not even reach your inbox. To prevent a cyberattack, make sure to encrypt emails containing sensitive information. Encryption ensures that only the intended person can view the email.

Tax preparers should be careful while opening attachments sent even by their clients. It could be possible that the client is unaware of malware or spyware located on their system which can be transferred into your system.

It would be a safer option not to click a link or attachment which doesn’t concern your work. If anyone claims to be a recommendation from a client or friend, check with them first before opening the mail or clicking anything.

If you find a mail suspicious, simply delete it without opening and clicking any links. In fact, the IRS encourages people to forward such emails to [email protected].

2. Stay Informed

Keeping yourself informed and updated is one of the best things you can do to keep your tax data safe. If something is too good to be true, then probably it isn’t. If someone is claiming on the phone to be from the IRS and demanding your SSN or other personal details, disconnect the call.

While the basics of security remain the same; it’s essential that you are aware of the specifics of the most expected threats at any given time. After all, unawareness is the most common cause of security breaches. Keeping yourself updated on the latest tactics used by scammers can be the difference in getting tricked and being safe.

Cybercriminals continue to evolve and use latest technologies to scam people. To prevent this, the IRS issues regular security updates and news through its newsletter. Subscribing to the IRS e-News subscription can be one the best ways to stay informed about latest security trends.

3. Educate Your Employees About Security

It is equally important for your employees to practice good cyber-hygiene. Checking personal emails, surfing the web, and accessing social media sites such as Facebook and Twitter should be restricted. Furthermore, they should also refrain from using USB ports on their office systems as spyware or viruses can be transmitted into the office workstation.

In case employees need to surf the Internet, you can provide them a dedicated system which isn’t connected to the office network.

4. Use Cloud Technology

Not all data security threats come from hackers. Sometimes the danger comes from within – from a careless, untrained or malicious insider. Tax data stored in-house is subject to all kinds of threats. It can be compromised due to a natural disaster like a flood or an artificial one such as a cyberattack.

Some tax professionals are still concerned about data security on the cloud. However, the cloud is more secure than your in-house server. That’s because cloud providers need to adhere to regulatory standards to operate. And their staff is well-informed and trained to keep the data secure as compared to an average IT professional.

Moreover, cloud service providers use methods which are difficult for cybercriminals to crack such as encryption (process to transform the text into non-readable format) and digest access authentication (the process of exchanging credentials).

Other benefits of cloud for tax professionals include real-time update, the ability to prepare tax forms from anywhere, anytime, no need for installation of software on the local computer, and easy pay-as-you-go model without any contract. Also, ensure that their data centers are spread out in different locations and are physically secure.

5. Start Early

Early filing of tax returns guarantees quicker tax refund from the IRS, and you don’t have to wait until the April end. In fact, late filing of tax returns also increases the chances of becoming a victim of cyber fraud.

Identity thieves attain taxpayer’s SSN (Social Security Number) and file false tax returns to get refund checks. Usually, they file returns before their victims, early in the tax season. The taxpayer would not find out about it until they file their own tax returns.

Therefore, it is best to file your taxes early in the season once you have all your tax documents and needed information as the IRS allows only one tax return per SSN per year.

What to Do If You Are A Victim of a Cyberattack?

If you’re the victim of a cyberattack, go through the IRS guide which includes reporting the issue to federal and local agencies. With Form 14039, you need to file a paper copy of the tax return. While reclaiming your identity, make different copies of your return and keep them in a secure place.

A cyberattack can be scary and threatening. Keep yourself informed with the knowledge to prevent any kind of cyberattack. Take prompt actions if you have become a victim of a tax scam.

If you want to learn more about keeping your tax practice safe, contact our technical experts for a free consultation: 855-665-8910