Remote work is more popular than ever–over a third of employees who have the option choose to work remotely while 41% have a hybrid schedule.

As the accounting and tax preparation industry continues to embrace remote work, the need for robust cybersecurity measures has become paramount. With sensitive client data, such as Social Security numbers, financial records, and personal information, being accessed and shared remotely, tax professionals must prioritize the protection of this critical information.

In this blog, we will explore the key strategies and best practices that tax preparers can implement to ensure the security of their remote tax preparation services.

1. Establish a Secure Virtual Private Network (VPN)

One of the foundational elements of a secure remote tax preparation setup is the use of a Virtual Private Network (VPN). A VPN creates an encrypted tunnel between the user's device and the internet, shielding sensitive data from prying eyes. This is especially crucial when employees are accessing client information over public Wi-Fi networks, which can be vulnerable to cyber threats. By requiring all remote staff to use a VPN, tax preparers can significantly reduce the risk of data breaches and unauthorized access.

2. Implement Multi-Factor Authentication

In addition to a secure VPN, tax preparers should also implement multi-factor authentication (MFA) for all remote access to client data and tax preparation software. MFA adds an extra layer of security by requiring users to provide additional verification, such as a one-time code sent to their mobile device, in addition to their login credentials. This effectively prevents unauthorized access, even if a user's password is compromised.

3. Utilize Secure Cloud-Based Storage and File Sharing

Traditional methods of storing and sharing client documents, such as physical file cabinets or email attachments, are no longer sufficient in a remote work environment. Tax preparers should instead leverage secure, cloud-based storage and file-sharing solutions that offer robust encryption and access controls. This ensures that client data remains protected, even when accessed or shared remotely. Popular options include platforms like Dropbox Business, Google Drive Enterprise, or Microsoft OneDrive for Business.

4. Implement Robust Access Controls and Permissions

To further safeguard client data, tax preparers should implement strict access controls and permissions within their remote work environment. This includes limiting access to sensitive information on a need-to-know basis, revoking access for terminated employees, and regularly reviewing and updating user permissions. By carefully managing who has access to client data, tax preparers can minimize the risk of unauthorized access or data breaches.

5. Provide Comprehensive Cybersecurity Training

Educating remote employees on cybersecurity best practices is crucial for maintaining the security of a tax preparation business. This includes training on topics such as recognizing and avoiding phishing attempts, creating strong passwords, and safely handling sensitive client data. Regular refresher training and updates on emerging threats can help ensure that remote staff remain vigilant and proactive in protecting the firm's and its clients' information.

6. Utilize Secure Tax Preparation Software

When selecting tax preparation software for remote use, it is essential to choose solutions that prioritize data security and compliance. These platforms should offer features such as end-to-end encryption, secure file sharing, and electronic signature capabilities, all while ensuring adherence to industry regulations and standards. By leveraging secure tax preparation software, tax preparers can streamline their remote operations while maintaining the highest levels of data protection.

7. Implement Robust Backup and Disaster Recovery Strategies

In the event of a data breach, system failure, or natural disaster, tax preparers must have a comprehensive backup and disaster recovery plan in place. This includes regularly backing up client data to secure, off-site locations, as well as having a well-rehearsed process for restoring operations in the event of an incident. By ensuring the availability and recoverability of client data, tax preparers can minimize the impact of any disruptions and maintain business continuity.

8. Foster a Culture of Cybersecurity Awareness

Ultimately, the security of remote tax preparation services relies not only on technological safeguards but also on the vigilance and awareness of the entire organization. Tax preparers should foster a culture of cybersecurity awareness, where all employees understand the importance of data protection and their role in maintaining the firm's security posture. This can be achieved through ongoing training, regular communication, and the implementation of clear policies and procedures.

By implementing these comprehensive security measures, tax preparers can effectively safeguard their remote operations and the sensitive data entrusted to them by their clients. In an era of increasing cyber threats and remote work, the adoption of these best practices is essential for maintaining the trust and confidence of both clients and regulatory bodies. As the accounting and tax preparation industry continues to evolve, the ability to securely deliver remote services will be a key differentiator and a critical component of long-term success.