10 Steps to Secure Tax Data

• Joyce Gamil
• • February 4, 2025
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Why Tax Season Is Prime Time for Cybercrime, and What You Can Do About It

Tax season is already a demanding time for accountants, CPAs, and tax preparers. Between tight deadlines, client appointments, and endless documentation, there’s little room for error. But in recent years, a growing threat has added another layer of stress: cyberattacks.

Every year, cybercriminals ramp up their efforts during tax season, targeting firms that handle sensitive financial and personal data. Why? Because tax documents contain everything a hacker needs. Social Security numbers, bank account information, income records, and more. And unfortunately, many small to mid-sized accounting practices simply aren’t equipped with the cybersecurity defenses needed to fend off these attacks.

A single breach can lead to devastating consequences: identity theft, fraudulent tax returns, lost client trust, regulatory fines, and even lawsuits. That’s why it’s no longer enough to “hope you’re secure.” You need a clear, proactive cybersecurity plan in place. Especially during the months when your exposure is highest.

The good news? You don’t need to be a cybersecurity expert to protect your clients. You just need to take the right steps.

In this guide, we’ll break down 10 practical and effective cybersecurity strategies tailored specifically for tax professionals. From data encryption and secure remote access to regulatory compliance and insurance, these tips are designed to help you stay protected, without disrupting your workflow.

Here are 10 simple but effective steps to help safeguard your clients’ confidential information during tax season:

1. Develop a Written Information Security Plan (WISP)

Creating a Written Information Security Plan (WISP) is not just a good practice, it’s a requirement from the IRS for all tax preparers and accounting firms. A WISP is a formal document that outlines your firm’s policies and procedures for protecting sensitive client information. Think of it as your cybersecurity playbook: it defines how data is accessed, transmitted, stored, and protected within your organization.

Without a WISP, your firm could face penalties, fines, or even risk losing the ability to legally prepare taxes. But beyond compliance, a WISP also builds trust. It shows clients and regulators that you take data protection seriously and have a structured approach to managing cybersecurity risk.

A strong WISP should include:

• Access controls: Who can access client data, and under what conditions.

• Staff training: Clear guidelines on cybersecurity best practices.

• Secure communication protocols: How documents are transmitted, stored, and destroyed.

• Incident response plan: Steps to take in the event of a data breach or cyberattack.

• Audit schedule: Regular reviews to ensure policies remain up to date.

By developing and routinely updating your WISP, you’re creating a proactive foundation for cybersecurity. Not just during tax season, but all year long.

2. Use Strong Encryption and Password Protection

Tax documents contain some of the most sensitive information your clients have. Social security numbers, financial records, and personal identification. That makes them a goldmine for cybercriminals. Encrypting your files and securing access with strong, unique passwords is one of the simplest and most effective defenses against data breaches.

Encryption ensures that even if a file is intercepted, its contents are unreadable without the correct decryption key. This is especially important when sending documents via email or storing them in the cloud. Tools like Adobe Acrobat Pro or secure file-sharing platforms often include built-in encryption features. Use them consistently.

Password protection adds a second layer of defense. Avoid common or recycled passwords, and always opt for long passphrases or randomly generated combinations. A password manager like Bitwarden, 1Password, or LastPass can help generate, store, and share passwords securely, so your team isn’t writing them down or reusing weak ones.

Also, never send passwords in the same channel as the file. If you email a document, text the password. This simple habit significantly reduces the risk of interception.

In short, encrypted files and strong password practices protect your firm’s reputation, help ensure IRS compliance, and offer peace of mind to your clients.

3. Implement Multi-Factor Authentication (MFA)

Passwords alone are no longer enough to protect your accounts. Especially during tax season, when cybercriminals are actively targeting firms handling financial data. That’s where Multi-Factor Authentication (MFA) comes in. MFA requires users to provide two or more verification factors to gain access to systems, dramatically reducing the risk of unauthorized entry, even if a password gets compromised.

Instead of relying solely on something you know (like a password), MFA adds something you have (like your phone) or something you are (like your fingerprint). The result? A much more secure login process that’s hard for attackers to bypass.

Better than SMS: While SMS-based MFA is better than nothing, it’s more vulnerable to interception. Authenticator apps like Authy or Google Authenticator generate one-time codes on your device that expire within seconds, making them far more secure. For even more protection, consider biometric authentication or push-notification-based MFA tools like Duo or Microsoft Authenticator.

MFA should be enabled on all platforms that access client information, email, cloud storage, tax software, and even remote desktops. It may add a few seconds to the login process, but it adds a major layer of protection that could save your firm from a costly data breach.

4. Secure Your Network and Devices

Every internet-connected device in your firm, from desktops and laptops to printers and mobile phones, is a potential entry point for cybercriminals. That’s why securing your network and all devices that handle tax data is critical during tax season.

Start by installing a reliable firewall to block unauthorized access to your internal systems. This acts as a digital barrier between your private data and the outside world. Pair it with up-to-date anti-malware software to detect and quarantine harmful programs before they cause damage.

Keep all operating systems, tax software, and applications updated. Software vendors regularly release patches that fix security vulnerabilities, ignoring updates leaves your systems exposed. Set devices to update automatically and schedule regular reviews to ensure nothing is missed.

To catch advanced threats, consider installing Intrusion Detection and Prevention Systems (IDS/IPS), which monitor network activity and alert you to suspicious behavior in real-time.

Finally, enforce secure device policies: use encrypted drives, disable unnecessary USB ports, and ensure staff don’t connect to public Wi-Fi without a VPN. These small adjustments go a long way toward preventing data theft and downtime. Especially when client information and your professional credibility are on the line.

5. Educate Employees on Cybersecurity Best Practices

Your team is your first and sometimes only line of defense against cyberattacks. Even with strong technical safeguards, human error remains one of the biggest threats to data security, especially during the busy tax season when focus is stretched thin. That’s why cybersecurity training is not optional, it’s essential.

Start by helping your staff recognize phishing scams. These deceptive emails often mimic official correspondence, tricking employees into clicking malicious links or sharing sensitive information. Train your team to verify senders, check for unusual language, and never open unexpected attachments.

Encourage strong password hygiene, including the use of password managers, and discourage password reuse across platforms. Emphasize the importance of locking screens when stepping away and not using public Wi-Fi without a VPN for any work-related tasks.

Most importantly, create a culture where reporting suspicious activity is encouraged, not punished. Employees should feel comfortable flagging odd emails or system behavior without fear of blame.

Regular, short training sessions, ideally once a quarter, keep security top of mind and help build lasting habits. A well-informed team can prevent most breaches before they happen, making them one of your firm’s strongest cybersecurity assets.

6. Use Secure Remote Access

As remote and hybrid work continue to grow, so do the security risks that come with accessing sensitive tax data outside the office. Whether your team is working from home, traveling, or checking a file between client meetings, using secure remote access tools is essential to protect your firm and your clients.

Start with a Virtual Private Network (VPN). A VPN encrypts your internet connection, shielding all data transmissions from prying eyes even on public Wi-Fi. It’s your first line of defense when staff work outside the office.

Avoid using personal devices for work, especially those not monitored or protected by your firm’s security protocols. Instead, issue company-approved devices that have antivirus protection, device encryption, and remote wipe capabilities in case of loss or theft.

Encourage the use of secure browsers and tools that block malicious websites, and require multi-factor authentication (MFA) for all cloud platforms and remote desktops.

Set clear policies around remote access. Including guidelines for when, how, and from where employees can work. A secure remote environment not only protects client data but also gives your team the flexibility they need without sacrificing safety.

7. Partner with IT Security Experts

In a rapidly evolving threat landscape, relying solely on in-house resources for cybersecurity can leave critical gaps. Especially for small or midsize tax firms. That’s where partnering with IT security experts becomes a smart and proactive move.

A managed IT service provider (MSP) or cybersecurity consultant offers dedicated expertise, staying ahead of new threats so you don’t have to. These professionals monitor your systems 24/7, respond instantly to suspicious activity, and regularly update your software and security protocols to match the latest compliance requirements.

Beyond daily protection, IT experts can guide you through developing a complete incident response plan, ensuring your team knows exactly what to do in the event of a data breach or ransomware attack. They also assist with compliance audits, employee training, and configuring encrypted data storage and file-sharing tools.

Perhaps most importantly, they bring peace of mind. Instead of worrying about firewalls, patches, and phishing schemes, you and your team can focus on what you do best, serving clients during the busiest season of the year.

A trusted IT partner becomes an extension of your firm, proactively defending your reputation, your data, and your bottom line.

8. Back Up Data Securely

In the digital age, data is everything especially during tax season. A single cyberattack, hardware failure, or accidental deletion can wipe out critical client files, financial records, and case history in seconds. That’s why secure, consistent backups are one of the most vital components of your cybersecurity plan.

Start with a multi-layered backup strategy. This means having:

• Daily backups of active client files and tax prep software

• Weekly full-system backups that include operating systems and configurations

• Quarterly archives for long-term storage and compliance documentation

• Real-time syncing for critical documents, minimizing data loss between scheduled backups

Always use encrypted backup solutions both for local and cloud-based storage. This protects sensitive client data even if a device or server is physically stolen or remotely breached.

Test your backups regularly. Many firms discover issues only when trying to restore files. And by then, it’s too late. Schedule a quarterly restore test to ensure your backups are working as intended.

By securely backing up data, you not only safeguard your clients’ information but also ensure your firm can bounce back quickly from disruptions without derailing your busiest season.

9. Stay Compliant with Data Protection Regulations

Tax professionals handle some of the most sensitive personal and financial data available. And that means staying compliant with data protection laws isn’t optional, it’s essential. Whether you’re a solo CPA or part of a large accounting firm, ignoring compliance puts your clients and your practice at serious risk.

Start by ensuring you meet the IRS Security Six and Security Summit guidelines, which lay the foundation for securing taxpayer data. But don’t stop there, your clients may also be covered by broader regulations like the General Data Protection Regulation (GDPR) if they live or do business in the EU, or the California Consumer Privacy Act (CCPA) if they’re based in California.

Compliance isn’t just about avoiding penalties, it’s about building trust. When clients know you take their privacy seriously, they’re more likely to stay loyal and refer others.

A managed IT provider can help by:

• Keeping systems updated to meet evolving legal standards

• Securing payment platforms, file transfers, and client communications

• Maintaining documentation and audit trails for accountability

Ultimately, staying compliant is a continuous process, not a one-time task. Make it a routine part of your firm’s operations to stay safe, legal, and competitive.

10. Consider Cybersecurity Insurance

Even with the strongest cybersecurity protocols in place, no system is 100% immune to threats. That’s why cybersecurity insurance is becoming an essential safety net for accounting and tax firms. Especially during high-risk seasons like tax time.

Cybersecurity insurance (also known as cyber liability insurance) provides financial protection and expert support in the aftermath of a cyberattack. Whether it’s a ransomware demand, data breach, or fraudulent wire transfer, the right policy can cover recovery costs that would otherwise cripple your business.

Key benefits of cybersecurity insurance include:

• Coverage for data recovery, legal fees, and regulatory fines

• Access to cybersecurity experts and incident response teams

• Compensation for business interruption and lost revenue

• Notification and credit monitoring for affected clients

Having insurance doesn’t replace the need for strong defenses, it complements them. Think of it as a backup plan that activates when the unexpected happens, helping you get back on your feet quickly without facing financial ruin.

Work with a provider who understands the risks specific to tax professionals, and review your policy annually to ensure it aligns with your current systems and services.

Don’t Let Cybersecurity Be an Afterthought

Tax season already brings enough stress without the looming threat of cyberattacks. But in today’s digital environment, protecting client data isn’t just a technical concern, it’s a core part of running a responsible and successful tax practice.

From phishing scams to ransomware and data leaks, the threats are real and growing. But here’s the good news: you don’t need a massive IT department or complex infrastructure to stay protected. By following the ten steps outlined above, even small firms and solo practitioners can build strong, practical defenses against today’s most common cybersecurity risks.

Whether it’s developing a Written Information Security Plan, enabling multi-factor authentication, or backing up data securely, each action you take strengthens the trust clients place in you. That trust is the foundation of your business and it deserves protection.

Need help implementing any of these steps? EKIM IT Solutions specializes in working with accountants, CPAs, and tax preparers to build custom cybersecurity strategies that are simple, affordable, and effective.

We’ll help you spot vulnerabilities, tighten your defenses, and prepare for the unexpected, so you can focus on what you do best: helping your clients.

🗓️ Book a  call with us
📞 207-333-2206
📧 info@ekimit.com
🌐 www.ekimit.com

Or check out our free resource:
👉 Cybersecurity Handbook

• Joyce Gamil
• • February 4, 2025
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