In the following article, Optima Tax Relief reviews measures tax professionals and tax filers can take to protect their data.
The Internal Revenue Service recently unveiled a new initiative designed to encourage professional tax preparers and taxpayers to adopt the free multi-factor authentication tool now available on widely available tax preparation software. Multi-factor authentication is an effective strategy for preventing costly data thefts.
It is estimated that the average total cost of every U.S. data breach is $8.4 million, according to the information technology research firm Ponemon Institute. In the first quarter of the 2020 tax year alone, the IRS has received nearly two dozen reports of data thefts from tax preparation firms. By integrating multi-factor authentication into their security protocols, tax preparation firms add an extra layer of security to highly sensitive data stores.
Multi-factor authentication is a security process that involves using codes delivered to multiple devices to access account information. When a login is attempted, the user can only access information sent to a separate mobile device. This measure has been highly successful in mitigating the theft of account information.
While the adoption of multi-factor authentication tools by both tax professionals and taxpayers is crucial to maintaining strong security protocols, it is equally important to stay vigilant about potential phishing scams. Phishing scams are emails or other electronic messages that are disguised as legitimate communications but contain malware designed to infiltrate hard drives. The user may inadvertently infect his or her own computer by downloading attachments or clicking links within the phishing email.
Tax professionals may also take the additional protective measure of tracking the number of tax returns using their Electronic Filing Identification Number (EFIN). This action will alert tax preparers to any unauthorized activity.
For more information about identity theft protection, please visit the Identity Theft Central page on the IRS website.