The IRS urges everyone with any type of online account to review new, stronger standards to protect their passwords. Doing so will help protect against savvy cybercriminals who wants to access people’s accounts and steal their identities.

Here are three steps people can follow to build a better password:

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• Step 1: Leverage powers of association. People can identify associated items that have personal meaning and use them in their passwords.

• Step 2: Make unique associations. Passphrases should be words that can go together in your head, but no one else would ever suspect.
  • Good example: Items in a living room such as BlueCouchFlowerBamboo.
  • Bad example: Names of children or pets.

• Step 3: Create a passphrase that you can picture in your head. The key is to create a passphrase that is hard for a cybercriminal to guess, but easy for the user to remember.

In addition to creating strong passwords, people can:

• Use a different password or passphrase for each account. People can consider using a password manager if necessary for multiple accounts.

• Use multi-factor authentication whenever possible. They should not rely on the passphrase alone to protect sensitive data. Multi-factor authentication means returning account holders need more than just their username and password to access an account. They also need, for example, a security code sent as text to a mobile phone.

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• Change all factory-set passwords. They should do this for wireless devices such as printers and routers. 

The IRS reminds holiday shoppers to protect their tax and financial data from identity thieves. All it takes is a few extra steps to prevent cybercriminals from stealing sensitive data, such as financial account information, Social Security numbers, and credit card information. Thieves could use this data to file a fraudulent tax return in 2019.
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This tip is part of National Tax Security Awareness Week. The IRS is partnering with state tax agencies and its partners in the Security Summit to remind to taxpayers and tax professionals about the importance of protecting data.

Cybercriminals want to turn stolen data into quick cash. They do this by draining financial accounts, charging credit cards, creating new credit accounts or even using stolen identities to file a fraudulent tax return for a refund.

Here are seven steps taxpayers can follow to help protect their accounts and their money:
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• Avoid unprotected Wi-Fi. Unprotected public Wi-Fi hotspots may allow thieves to view transactions.

 

• Shop at familiar online retailers. Generally, sites using the “s” designation in “https” at the start of the URL are secure. User can also look for the “lock” icon in the browser’s URL bar. That said, some thieves can get a security certificate, so the “s” may not always vouch for the site’s legitimacy. Beware of purchases at unfamiliar sites or clicks on links from pop-up ads.

 

• Learn to recognize and avoid phishing emails. Thieves send these emails, posing as a trusted source, such a financial institution. or the IRS. The criminal’s goal is to entice users to open a link or attachment. The link may take users to a fake website that will steal usernames and passwords. An attachment may download malware that tracks keystrokes.

 

• Keep a clean machine. This applies to computers, phones and tablets. Taxpayers should use security software to protect against malware that may steal data and viruses that may damage files.

 

• Use passwords that are strong, long and unique. Experts suggest a minimum of 10 characters but longer is better. People should also avoid using a specific word in the password. They should also use a combination of letters, numbers and special characters.

 

• Use multi-factor authentication when available. This means users may need a security code, usually sent as a text from a financial institution or email provider to a mobile phone. People use this code in addition to usernames and passwords.

 

• Encrypt and password-protect sensitive data. If keeping financial records, tax returns or any personally identifiable information on computers, this data should be encrypted and protected by a strong password.

Did you know the IRS is prohibited from releasing information you report, except in limited circumstances? You have to grant specific authorization to allow someone to discuss your return with the IRS, receive copies of your returns or tax notices, or negotiate with the IRS on your behalf.
 
For example, say you receive an IRS notice, and you want your tax preparer to resolve the issue for you. The only way your preparer can help is if you have given permission allowing an exchange of information with the IRS.
 
Here are three ways to grant authority for access to certain tax information:

1. Third-party designation. You may think of this as the "checkbox" authorization found near the signature area of your tax return. By checking the box and completing the requested information, you grant limited authority for the receipt or inspection of your tax information for that particular return.

The person you authorize will not automatically receive copies of IRS notices, but can review your information for the specific tax period. The authorization expires one year from the original due date of the return.

Form 8821, Tax Information Authorization. This form is a disclosure authorization that allows the person you choose to automatically receive notices and other information about your taxes for periods you specify. You can revoke the authorization by submitting a signed copy of the original with the word "Revoke" written across the top.  

Form 2848, Power of Attorney and Declaration of Representative. The power of attorney lets someone who is eligible to practice before the IRS represent you and, in some cases, sign agreements and other documents on your behalf. You can revoke a power of attorney by filing a new one for the same tax period, or by sending a signed copy of the original with the word "Revoke" written across the top. ​
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Other forms may be required, depending on the type of tax information and how much authority you want to grant. Give us a call for help granting authorization.

Tax reform legislation enacted in December 2017 offers a new tax credit for employers who provide paid family and medical leave. Here are several facts about how this credit works and which employers are eligible to claim it:
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• The credit is available for wages paid in taxable years beginning after December 31, 2017, and before January 1, 2020.
• Some employers can claim the credit retroactively to the beginning of their first taxable year beginning after December 31, 2017, if they meet the terms of a transition rule on or before December 31, 2018.
• To be eligible for the credit, an employer must have a written policy in place that includes:
  • At least two weeks of paid family and medical leave annually to full-time employees, prorated for part-time employees.
  • Pay for family and medical leave that's at least 50 percent of the wages normally paid to the employee.
• Generally, for tax year 2018, the employee's 2017 compensation from the employer must be $72,000 or less.

The credit ranges from 12.5 percent to 25 percent of wages paid during an employee's leave.
For purposes of this credit, family and medical leave includes leave for one or more of the following reasons:

• Birth of an employee's child and to care for the child.
  Placement of a child with the employee for adoption or foster care.
• Care for the employee's spouse, child or parent who has a serious health condition.
• A serious health condition that makes the employee unable to do the functions of their position.
• Any qualifying need due to an employee's spouse, child or parent being on covered active duty in the Armed Forces. This includes notification of an impending call or order to covered active duty.
• To care for a service member who's the employee's spouse, child, parent or next of kin.

More information: 
https://www.irs.gov/newsroom/section-45s-employer-credit-for-paid-family-and-medical-leave-faqs

Please call us if you have questions or would like further information.​

Safekeeping tax records helps for future filing, amended returns, audits 
 
WASHINGTON — With the tax filing season quickly approaching, the Internal Revenue Service wants taxpayers to understand how long to keep tax returns and other documents.
 
This is the seventh in a series of reminders to help taxpayers Get Ready for the upcoming tax filing season. The IRS has recently updated its Get Ready Page https://www.irs.gov/individuals/steps-to-take-now-to-get-a-jump-on-next-years-taxes with steps to take now for the 2019 filing season.
 
The IRS generally recommends keeping copies of tax returns and supporting documents at least three years. Employment tax records should be kept at least four years after the date that the tax becomes due or paid, whichever is later. Tax records should be kept at least seven years if a return claims a loss from worthless securities or a bad debt deduction. Copies of previously-filed tax returns are helpful in preparing current-year tax returns and making computations if a return needs to be amended.
Safe-keeping records
Tax records should be kept safe and secure regardless of whether they are stored on paper or kept electronically. Paper records should be kept in a secure location, preferably under lock and key, such as a secure desk drawer or a safe. Records retained electronically should be backed up electronically and encrypted when possible. The IRS also suggests scanning paper tax and financial records into a format that can be encrypted and stored securely on a flash drive, CD or DVD with photos or videos of valuables.
 
Disposing of records
Tax records contain sensitive data such as Social Security numbers, income amounts and bank account information. Tax documents not properly disposed of can land in the hands of criminals and lead to identity theft. Once past their useful date, records should be disposed of properly. Paper tax returns and supporting documents should be shredded before being discarded. Old computers, back-up drives and media contain sensitive data. Deleting stored tax files will not completely erase them. Using special wiping software ensures the removal of sensitive data.
 
Taxpayers still keeping old tax returns and receipts stuffed in a shoe box may want to rethink their approach. When records are no longer needed the data should be properly destroyed.
​More information is available on IRS.gov at How long should I keep records?  
​https://www.irs.gov/businesses/small-businesses-self-employed/how-long-should-i-keep-records