Cybersecurity is serious business, especially when it comes to compliance. Threat actors know this, smart organisations know this, and regulators know this. In the past, organisations could get away with weak cybersecurity controls because attackers were few and attacks were rare. However, those days are long gone. In today’s enterprise landscape, thousands of cyberattacks occur every single day, emphasizing the critical importance of maintaining robust cybersecurity measures in alignment with compliance requirements.
Knowing this, many regulators have implemented laws and standards that organizations are required to comply with. For example, the Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires healthcare organizations secure consumers’ protected health information (PHI) and the Payment Card Industry Security Standards Council administers the PCI DSS standard that aims to protect customer credit card data.
Recently, the U.S Internal Revenue Service (IRS) has also formulated a series of cybersecurity guidelines called Publication 4557. These guidelines help tax professionals understand the proper security defenses needed to protect their clients’ sensitive data. And yet, many tax preparers struggle to implement these defenses and comply with the guidance.
Overview of IRS Publication 4557
Hackers and data thieves frequently target CPAs and accounting firms – and even sole practitioners – because they manage and store valuable financial and personal data. Bad actors often steal this data to perpetrate identity theft, blackmail victims, or to sell it on the dark web to other criminals.
These attacks present a significant risk to tax practitioners. In addition to losing critical data, they also risk hefty IRS penalties while also losing their clients’ trust – both of which can have a detrimental impact on their business’ reputation, revenues, and continuity.
Publication 4557 was designed to help tax professionals avoid these situations and protect their clients. It includes information about the FTC Safeguards Rule that requires tax preparers implement measures to protect customer information and have a detailed security plan appropriate to the sensitivity of this information.
The publication also describes the various security provisions that tax practitioners should implement to protect stored data, secure wireless networks, report security incidents to the IRS, and much more. These provisions also cover:
– Security software
– Password security
– Guarding against phishing scams
– Monitoring requirements for EFIN/PTINs
– Breach remediation strategies
– Employee management and training
– Detecting and managing system failures
It is important to note that any organization that files personal or corporate returns with the IRS is required to comply with the requirements of IRS 4557.
The Challenges of Implementing the Requirements of Publication 4557
The requirements laid out in Publication 4557 can be intimidating. Many tax professionals are taxation experts but cybersecurity novices, so implementing these requirements can be particularly overwhelming.
Many CPA firms – large tax preparation companies and sole proprietor CPAs alike – are not even aware of all these requirements, much less compliant with them. The lack of knowledge and implementation gaps create serious security and compliance risks, both to the company and the client data they control.
One way to fill the knowledge gap and achieve compliance is to hire third-party companies that specialize in IRS 4557 compliance. The problem is that while some of them do help their clients cover the requirements in IRS 4557, they can be very expensive. Another issue is that they often provide a fancy package of activities that look great on paper but in practice are overkill and sometimes even unnecessary.
Instead of all these bells-and-whistles, what taxation firms really need is to protect their company’s reputation and clients’ private data with actual security. For this, they need to invest in security modernization and to some extent, consulting.
And these investments don’t have to involve fear-based solutions or long-term expensive subscriptions. What they need is robust security software and expert guidance on how to implement and maintain it. Enter GCS and SecureCloud.
A Better Way to Comply with Publication 4557
Are you a tax professional? Then the law states you HAVE to comply with the requirements of Publication 4557. But if the previous sections have increased your heart rate, there is light at the end of the tunnel! GCS Secure Cloud enables you to meet the requirements of Publication 4557 quickly and cost-effectively.
SecureCloud’s services help you with everything you need to secure your client data and comply with 4557’s regulations. This includes identity and endpoint protection, data loss prevention, and vulnerability management. In addition, our consultants can assist you with process documentation, employee cybersecurity education, and more.
The solution also includes several advanced capabilities like active real-time monitoring and monthly security posture reviews to keep your business and clients safe from the bad guys. And all this priced per employee and no long-term contracts to tie you down.
If this is the first time you have heard about Publication 4557 don’t worry. We can get you a head-start on your compliance program AND provide you enterprise grade security at a price affordable to any business.
Book a consultation with a GCS technology expert. Click here.