Most recent

Is your CPA Properly Securing Tax Records?

By Tom Skeen

With tax season right around the corner for most people in the U.S., have you ever questioned your accountant about his or her security practices? Your accountant has some of your most personal financial information and they must be diligent with security and securing tax records.

Due to the complexity of the tax code and to take advantage of all deductions and to have accurate returns filed, more and more Americans are seeking out professional tax preparers to file their returns. A recent survey suggests that there are nearly 1.2 million tax preparers in the U.S. and the IRS estimates that they are filing more than half of all tax returns. 

What Information Does Your CPA & Tax Preparer Hold?

Your accountant has confidential information about you, ranging from social security numbers, bank and credit account information, investment portfolio account numbers, financial statements, purchase agreements, and employee information, if you own a business. If this information were to be compromised, the identity of you, your family members and employees would be at risk.

How Do You Exchange Information with Your CPA or Tax Preparer?

Now that it’s clear what type of information is at risk - how have you provided these documents to them? Over the years I have been asked to fax, send via unsecure email, upload via an unsecure website or to simply drop off at their office to an administrative assistant, just to name a few methods. Most people think that just because a “professional” CPA or tax preparer tells them to send tax records a certain way, they must comply.

How to Secure Tax Records:

As heard on the news, companies are being hacked left and right. If you're dealing with a CPA, it's about time to make sure they are securing your records properly. If you've already been a CPA for years, it's time to consider the security of your records, your reputation as a professional and protecting the identity of your clients. It’s not difficult to implement a security program quickly. Outlined below are just a few of the most important items.

  1. Only exchange confidential information over a secure channel
  2. Encrypt all information once received
  3. Scan all paper documents into a secure encrypted vault for safe keeping
  4. Back up information and keep an audit trail of documents sent and received
  5. Only provide a secure portal for clients to upload documents
  6. Scan incoming and outgoing documents to prevent a virus and loss of information
  7. Use proper identity and access management tools


These items at first glance might seem excessive, but they cover most security situations ranging from the rogue maintenance person that has access to paper documents - to the malicious insider that wants to export data to someone on the outside - to the hacker that is trolling your network.  

The Threats & Risks Are Real

In June of this year, a hacker was sentenced in New Jersey federal court for a $6 million tax-refund scheme fueled by client information that he and his co-conspirators stole from four accounting firms in three U.S. states. They hacked into the firms’ computer systems and stole information about more than 1,000 clients. The risk is real and likely increases each year during annual tax season.  Securing tax records must be made a priority.

Safe-T’s Security Solution

Safe-T Box enables organizations to broker, control and secure data exchange of any type and size between people, applications, cloud solutions, and businesses. It offers secure email, encrypted vaults, connectors to antivirus scanning and data loss prevention systems to protect information end to end. The solution will assist in securing tax records by maximizing security and minimizing information loss and can be installed in a matter of days not weeks.   

Whether you are a CPA, Tax Preparer, or a client of these professionals, you must be diligent and question security practices and ways of information exchange in an effort to secure tax records.  Otherwise, the consequences could be devastating and lead to identity compromise, litigation, reputational and/or financial loss.

To learn more about the how to secure your sensitive documents and organization entirely, download this white paper.

<< Learn How States Can Secure the Electoral Process, Here >>


All posts