Why You Need to Know About the IRS Security Plan

Federal law requires tax preparers to create a written information security plan to protect clients’ data. Data thefts have been on the rise from the Colonial Pipeline hack and T-Mobile’s data breach. Big companies aren’t the only ones at risk for these hacks. In one attack alone, between 800 to 1,500 small businesses were harmed from Kaseya’s attack in 2021. Cybersecurity is a necessity in 2022 and will continue to be the forefront as we navigate through a new year.

Every employee on any level should be educated about security threats and safeguards to protect the individual taxpayer. There is a plan in action from the IRS named both the Security Summit and the IRS Data Security Plan.

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What Does the IRS Data Security Plan Require?

According to the IRS, the Safeguards Rule outlines that financial institutions must protect the consumer information they collect and requires companies to develop a written information security plan that describes their program to protect customer information.

The required information security plan must be proper to the company’s size and complexity. Each company must:

Appoint one or more employees to coordinate the security program

Find and assess risks to customer information in each relevant area of the company’s operation
Evaluate the effectiveness of the current safeguards and outline areas for improvement
Design and implement a safeguards program and regularly test it
Select service providers that can keep proper safeguards with a contract that requires routine maintenance
Evaluate and adjust program upon climate, change of operations, or results from testing

While these requirements are flexible, the FTC encourages companies to go above and beyond with their cybersecurity as the climate continues to shift towards cloud-computing and digital-based services.

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What Could You Do Additionally for Your Cybersecurity?

The IRS also outlined basic protections you can instill to exceed general requirements.

Use anti-virus software and set it up for automatic updates on all devices.

Use multi-factor authentication (2FA) to protect all accounts. We recommend using an application that automatically generates access codes like Google Authenticator.
Ensure you have back-up plans for all files. These files should be on an external hard drive or cloud-based storage.
Encrypt all your data.
Use a Virtual Private Network (VPN) product especially if you are accessing public or personal Wi-Fi.

For more details on the Security Summit, please review here.

If you don’t prioritize your cybersecurity this year, there’s a running risk of losing important data from your company and clients. Act where you can.

View This Article: Educate Your Employees about Cybersecurity

Does This Sound Overwhelming?

Don’t worry about your IT. Go Kall IT offers premiere outsourced IT services for businesses like you. Cybersecurity is getting trickier to handle but you don’t need to be an expert to get the proper systems in place to protect company and client data.

Book an appointment today while slots are available before the tax season hits.