The IRS Warns Taxpayers to Protect Tax Data and Keep All Sensitive Tax Data Safe
Did you know that when you protect tax data it will help with your future filings, amended returns and audits? Not to mention protect your identity, as well?
Since we all are heading in tax season soon, the IRS wants all taxpayers to be aware as to how long to keep tax returns and other supporting documents.
Hold On to Your Tax Documents and Protect Tax Data
Typically, the IRS recommends holding on to copies of tax returns and supporting records for a minimum three years. Employment tax records should be kept a minimum of four years after the date that the tax are paid or due. Make sure that it is the later date. For example if you pay the taxes before they are due, then keep them as of the due date. Or, if you paid the taxes after they became due, then use the payment date. Tax records for claims on losses from worthless securities should be kept at least seven years. This is the same with bad debt deduction. Always, keep copies of filed tax returns. These copies help when preparing your current-year tax returns. This is especially try when you need to make computations for an amended return.
The last thing you need is someone getting a hold of your private information. It is wise to keep your tax records safe and secure in a locked file cabinet or desk drawer, and if possible a locked room. Never access your tax information on a public computer. And when you use your private computer, make sure the file is encrypted, backed up and secure. In fact, the IRS recommends scanning your paper tax returns and financial records onto a flash drive, CD or DVD, as a format that can be encrypted and stored securely. This is also a good rule for photos or videos of other valuable property you may own.
Protect Yourself Against Identity Thieves
Remember, your tax records contain sensitive information, this is why it is critical to keep all tax data safe. Not only your tax information, but your family’s tax data, as well. These tax records include, but is not limited to: Social Security numbers, dates of birth, income and bank account information. There are identity thieves and criminals out there who would just love to get their hands on your tax documents. Take every opportunity possible to accurately to not only protect tax data, but to dispose of your tax documents to keep all sensitive tax data safe.
Disposing Tax Records
As soon as tax documents are past the date of usefulness, dispose the records. Remember to shred paper tax returns and supporting documents, and, if possible, burn them before you trash them. Overkill? We don’t think so. Identity thieves will go as far as taping pieces of tax returns together, like a puzzle, just to get what they want. Also, remember that old computers, back-up drives and other media, stores this sensitive data. Therefore, deleting the tax files DOES NOT erase them completely. You have heard a lot about BleachBit on the news in years past, right? Consider investing in a data destruction software tool that will completely wipe the computer clean, eliminating all sensitive data. In addition, if you must, immerse the drive in water and smash it. Do whatever it takes to secure your information. We can’t be responsible how to tell you how to clean your computer, that is up to you, we only suggest you do whatever is possible to keep your information safe.
Shoebox Storage BAD IDEA!
Are you a taxpayer who keeps all your old tax returns and receipts in a box in the attic? Consider rethinking this storage option. Not matter how you disguise or hide the information, it is still vulnerable to fire and theft. Remember, properly destroy all records when they are no longer necessary. And, remember that this information could help you with future tax filings, audits and amended returns.
Do You Need More Suggestions on How to Keep All Sensitive Data Safe?
So as you can see it is critical to protect tax data and to keep all sensitive tax data safe. Call Alex Franch, BS EA at 781.849.7200 or email the office at email@example.com to secure help with your small business accounting needs. You can also book an appointment online here and you can meet with any of our tax experts. We are available by appointment at our three convenient locations in Norwell, South Weymouth and Dedham, Massachusetts.
Also, refer to IRS.gov, The Internal Revenue Service has an aticle on How long should I keep records? We suggest you take a look at it. Also, for more year end suggestions on how to get ready for tax season, The IRS has a Get Ready page https://www.irs.gov/individuals/steps-to-take-now-to-get-a-jump-on-next-years-taxes for taxpayers to refer to for the 2019 tax filing season. Remember to do all you can to keep all sensitive tax data safe.
Alex Franch, BS EA
Alex is a Tax Specialist and Partner at Joseph Cahill & Associates / WorthTax. He has a diverse background including a Bachelor of Science from Boston College in Mathematics and extensive military service. Alex is an Enrolled Agent and has a decade of tax preparation experience. He is passionate about serving businesses with tax and financial planning strategies.
Mr. Franch is licensed by the Financial Industry Regulatory Authority (FINRA). He holds a Series 6, 63, 65, and 7, and by the Commonwealth of Massachusetts Division of Insurance.
Alex Franch is a registered representative of, and offers securities and investment advisory services through, Commonwealth Financial Network. He is a registered broker-dealer, Member FINRA/SIPC.
Sources and Resources
- Tax Reform is Confusing Part 2
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