When tax time comes around, are you being reactive or proactive? Do you find yourself swimming in a sea of questions? Like, is it better to do my tax return cheaply? How do I know if I’m doing them the right way? Welcome to The Tax Answers Advisor with Marcelino Dodge. Today we’ll answer these questions and many more. Sharpen your pencils and take some notes. Now, here is your host, Marcelino Dodge.

Marcelino: Welcome to The Tax Answers Advisor. I am Marcelino Dodge with the show covering what just everyone loves to talk about at the dinner table; that is, federal income tax.

Today we were discussing something very vital when it comes to income tax, but not particularly regarding the tax code but something in regards to your data when you have a preparer do your data and that is the security of your data and this is going to be a vitally important topic because people are actually targeting tax preparers especially those hackers and so on. It’s a good subject to be aware of and you need to really know how secure is your data when you take it to a tax preparer.

I want to give a big thank you out to listeners here in the United States as well as those listening around the world. There is Ireland, China, Indonesia. Really, thank you so much for listening to this podcast. It’s such a privilege to be able to share this information with you all.

A few updates for this week here: this week the IRS released inflation adjustments for the 2021 tax year, for each of the filing statuses and also like for retirement plans and so on. We would probably share those on the blog here later this week. This is actually some bad news. The Internal Revenue Service, which stopped sending out some balance due notices back in May, while the IRS is going to resume to start sending out some balance due notices on some taxes. You could possibly be expecting those in the mail in the next few weeks.

Now back to our topic of the day which is data security and this is vitally important with your tax data because when you share your data with a tax preparer, it is basically your whole life. Many times, I know people come into my office or they send me information through my web portal, it’s vital that I keep that information secure.

Why is that? When you think about it, when you go to a tax preparer or you send in the information or transmit electronically, many times, and I know for my office in particular, we have to have items such as driver’s licenses or other forms of identification. We need to have, if you have dependents like children you’re claiming, oftentimes birth certificates, also social security cards, and also social security cards of the parents as well especially if you’re a new person coming in the office and I don’t know you. We take all these precautions.

Many times, why the tax preparers get this information is basically because of what’s called in our business “due diligence”. We got to make sure that those to whom we’re providing the service to are who they say they are, the children that they’re claiming are the children that are actually theirs.

Documentation, which is basically everything that a potential thief would need to steal your identity is in a tax preparer’s office and those who are trying to do identity theft know this already. It’s vitally important then that you as a taxpayer know that the tax preparer you are working with has your data secure, not just physically but also electronically; some good points to keep in mind here.

Some of the points we’re going to cover this evening, I mean this day or this show is from the Financial Modern Services Act of 1999, also known as the Gramm-Leach-Bliley Act. Basically, without getting in too much detail with this reminds us of that each year you get these privacy notices in the mail from your various financial institutions: your banks, your credit cards.

You get a meter electronically come to your e-mail filling up your e-mail box or they come to you in the physical mail, through the postal service. You get these notices. Why do you get those? It’s because of that act passed in 1999, basically covering data privacy.

How does this come back to tax preparation? As a tax preparer, one who does the taxes for individuals, I have also required provide a copy of my privacy policy to those to whom I work at the time we engage the service.

Whether you go and check it out on my website or we’re visiting through a web conference like through Zoom and we’re deciding to do business, I should provide to you or send you electronically if we’re doing it that way or if you’re in the office, have a physical copy of that privacy policy available for you to review. You as the client understand how your data is protected in the office and exactly what your data is being used for.

It’s important to know these things because once again, you want to know how your data is used and is your data going to be safe with this person you’re using or you’re using to prepare your tax return. As I mentioned, yes, this needs to be in a hard copy or in electronic form. More and more it’s becoming electronic. Like in my case, they’re available on my website

Some of the information that is absolute vital that is necessary to be in there is just what you’re collecting like names, birthdays, social security numbers, those kinds of items, addresses. All of these need to be said in the privacy policy and it’s important.

Normally when we get those in the mail, I know I’m guilty, I know I do this. I get them from various institutions I work with. I go, “Oh, it’s a privacy policy.” Sometimes I kind of scan it, move on. Other times I just go, “Privacy policy” and I throw it away. Most of us do that. It’s just what we do.

It’s important that at least you get the policy at the time of engagement or with your tax return. It’s vital to get that because every client that comes in has an opportunity to see our privacy policy as well as a copy is included with each and every tax return that leaves this office.

It is also good to know on this privacy policy other third parties who may have access to your data and that could include as well software companies that a tax preparer uses. It could include the tax preparation company. It could include a company that maybe they use for their electronic storage information. It could include many other companies that they may use within their practice and their practice of preparing tax returns. It’s good to know that.

Another important factor to know of any privacy policy, which is a practice that I personally avoid and do not do and that is outsourcing, which basically is a fact. Does that office send your information over to another office electronically, have them process it or put it into a tax return and send it back? Data outsourcing, do they have that? Some offices do that. It’s neither good nor bad.

All I know is that it’s a practice that I do not do. Everything stays in-house within these walls of my office and within my networking systems so that I know what’s going on with that data. That is vitally important to know that and that’s why on my privacy policy it plainly states. We do absolutely no outsourcing of client data. It’s one thing that it would be good to know if you’re going to someone perhaps for the first time. Yet, we as a business do not do that.

Now another area that is very important to think about is that sometimes we think, “I got an easy tax return. So-and-so over here would do it for like, 50 bucks or a hundred dollars.” Now think about this: if you go and do that, what essentially are you providing to that person? You’re providing for that person who may be using some type of do-it-yourself software, not really a commercial grade software, what you’re going to do is you’re going to give them the same information that you would give to me coming in to my office or transmit to me via my electronic portal. You have to give them pretty much the same information.

Now the question is though, how secure is your data going to be with those individuals, which by the way, those individuals are pretty much known as a “ghost preparer?” You’re thinking maybe, “What is a ghost preparer.” Many times, these individuals who do this, what they do is build you some type of do-it-yourself software.

They’ll enter in all your information: social security numbers, birth dates, information off of your W-2’s or other information that is vital for a tax return. They’ll enter it in. Sometimes they’ll be using the interview mode on the do-it-yourself software they’re using. They’ll go around. They’ll complete your tax return.

Some of those softwares are also, when you go set them up, you have to set up an account. You use some type of e-mail address. How that works, I really don’t know. I do know you have some type of log in with them.

The other part is because it is do-it-yourself software and this third party or ghost preparer that you’re using could very well be, well, with entering your information, but how secure is your information?

After that tax return is transmitted through the do-it-yourself software, who has access to that if you have any problems with the IRS, as well as these ghost preparers where the real issue comes in with these individuals is the fact that 99 percent of the time that you may pay them fifty bucks or a hundred dollars to do your tax return, but yet the bottom portion or actually it used to be the bottom portion of page two, now it’s on page one.

There’s a portion there that says “Paid preparer’s information.” That is where that individual who prepares the tax return and was paid to prepare the tax return is required by law to put in their information, their name, address, tax ID number and also required by IRS Tax Code to put it in their PTN, which is an ID number that is assigned to each preparer of taxes.

You’re really compromising your data if you use such a person to do that because one reason is if there’s a problem with your tax return, as far as the IRS knows, you self-prepared the tax return with some type of do-it-yourself software because it will say when it goes to the IRS, it says “self-prepared.” As far as they know, no third party was involved in it.

What you got to think about is how secure is my data if this third party is doing this and putting in this information? I can have compromised data. Even if they give you everything back, who has access to that account? I mean I don’t know and it is a strong warning I put out not to use people who do not sign tax returns. Just by themselves and in that alone, you could be compromising your tax data and potentially be a victim of identity theft because of this.

One of the big, big issues I run into when it comes to data security and data theft is theft of children’s information, something bared to be aware of. Make sure whatever you do has a good data security policy and is someone who signs the tax return.

We’re going to talk more on this security issue and more on to physical office security when we come back in just a couple of minutes. This is Marcelino Dodge. I’m a Tax Answers Advisor on the Voice America Business Channel.

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Today’s tax and financial environment is constantly changing. Tax laws change rapidly. The traditional reactive approach to tax preparation and taxes no longer works. To deliver the best possible outcomes in today’s world, you need a year-round approach to take advantage of tax law changes and to pay as little tax as possible. Marcelino Dodge of Cash Tracks Financial helps his clients to implement proactive tax strategies throughout the year to limit his clients’ tax liability plus with this year-round approach, clients can increase their cash flow and be as prepared for the future as they can be. E-mail Marcelino at or call (844) 394-4287.

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This is The Tax Answers Advisor with host, Marcelino Dodge. To reach our program today, please call in. The number is 1-866-472-5790. That’s 1-866-472-5790. You may also send an e-mail to Now, back to The Tax Answers Advisor.

Marcelino: Welcome back to The Tax Answers Advisor. I appreciate you sticking around for this next portion. I am Marcelino Dodge today talking about the importance of security of your data with regards to tax preparation and tax offices. We touched previously in our last segment just a little bit about data security policy and why it’s important to use someone who really secures your data.

This time we’re going to go into physical office security. You come in to a tax office or you go to a tax preparer. How secure is your information physically going to be? We’re going to talk about electronic in just a little while. Physically, how safe is your information in a physical sense? In this world, the physical, delivering physical W-2’s and so on is becoming less and less, but yet there’s still information that is on paper, which some people prefer to do business at. That’s fine.

I have individuals who will still physically mail their tax information and copies of ID documents to me, which that’s okay, which when that happens, or if a person walks in the door and has their tax documents and tax information plus other identification documentation plus documentation for their children, that information needs to be physically secured for the time period that we have that.

Our client files, we start off a new file for a client. How secure is that? That starts with whoever you have at the front desk. Has that individual that is in the receiving area, has that individual had a background check? That is something important to know at an office. Have the employees been background checked? Does the employer know?

In my case, I’m the employer. I have an assistant that has had a background check and has come through clean. That’s important because people want to know that they can walk into an office. They can trust these individuals with their information and it’s not going to end up somewhere on the dark web or be sold for illegal purposes. That’s important on how client files are secured.

The next step is what’s the policy of this office at the end of the day or even during the day? For example, the employee at reception who has duties but they may need to go take care of some personal business in the office. While they’re away from their desk, do they leave anything on that desk that can identify a client, that has any information that can be compromised?

The answer to that question is there should be nothing on that desk and if they’re the only one in the office, the front door should be secured so that no one can come in and get that information. Desk should be locked and even file cabinets, which we still have some file cabinets here, old-style, four-drawer cabinets, which are physically locked when someone is not in the office and they’re physically locked if we need to leave the office for a little bit.

These are always locked so any client information that is in the desk, inside the desk or inside the file cabinets so all of that information is totally secure. It’s good these are items that it’s good to know about and to be aware of. My assistant here is trained. What she does is she takes care of these items. She’s very careful, understands the privacy, confidentiality of client information, safety of client information so that yes, we do lock the door each and every night.

We lock it during lunch when nobody’s here. We have a regular lock. We have a deadbolt lock. We have a security system with 24-hour monitoring as well adding to the level of physical security in the office and there’s a camera in our office as well. We have all of these safety measures in place physically to protect client data and at least for me personally, this is the bare minimum that anybody should have and there could even be some more that some offices may need.

Every office is different, but we keep what we absolutely need here with 24-hour monitoring and I can check on my devices. Look at the camera. Here’s what’s going on over there. Check to make sure the status of the security system, make sure that’s working. Okay, great. That is set so we are good to go. We know the office is secure 24 hours a day, seven days a week.

In addition to that security measure, you also have to look at electronic data protection because that’s essentially, when you really look at it, that is like the back door into an office. Even if you don’t physically have a back door, you can have a back door coming in through electronically through your network. Electronic data protection is required by the IRS that tax preparers like myself have some type of data protection policy in place.

When it comes to data protection, perhaps the weakest link in that data protection is my employee. Why is that? My assistant, again has been trained not to click on any e-mails that have a link. A site comes with the link and especially whoever’s sending that is unknown, you do not click on that e-mail. Period.

End of story because that is why in offices there are often breaches is because someone clicked on the link in an e-mail that they should not have and thus, some type of malware is installed on to their computer and because of that you can have ransomware demands or other issues arise that it’s just vitally important that that not be done. It’s good to make sure that whoever has the reception area, wherever the employees of that having the understanding that protection of client data is vital and this is one of the ways that it is done.

As we move on past that weakest link and cover that, it’s vitally important because one area that is next in your course is security software. There are a variety of companies out there. I don’t endorse or push any company. What I do encourage is that you need to make sure that whoever is doing your taxes, a professional like myself, has some type of security software on their system, some type of software.

There are many vendors, many quality vendors available. Make sure that it has anti-virus protection and it has firewall protection. It has malware protection, all of those protections in there so that it minimizes any potential threat to your computer coming in off of the internet because so many offices, like my own, are connected to the internet and using software that is cloud-based software. When using this cloud-based software, you are on the internet constantly all day long so you got to have these protections in place.

Whoever does your tax return has to have these types of software in place on guard 24 hours a day and being regularly updated. That is the key. Whoever is using or using your tax data cannot be using or should not be using some type of the free anti-virus software because those just, in this environment that we’re in now is just not as protection…I don’t think they’re as good as buying a quality protection system that will certainly safeguard your system.

To go along with your security, your software, it’s a good, good idea to have a really good quality router for your office, a really good quality, if you’re going to have Wi-Fi, to have a really good quality Wi-Fi in there with all the highest 128 Gig protection or bigger or even 256 protection. Have at least those in place so that your Wi-Fi network is also secure for your devices.

Make sure that if an office has Wi-Fi, it’s good that they have actually two separate Wi-Fi. Some accounting offices will maybe have a guest Wi-Fi. That’s okay as long as that Wi-Fi is totally separate from the Wi-Fi that is used by the employees.

On my tablet, for example, I have the Wi-Fi network that my tablet accesses which is connected to the same network that my desktop computers are connected to; however, I have a guest Wi-Fi that is totally isolated from the rest of the network. Because of that, my clients’ data is as secure as it can be. That is another vital, vital effort in having secure data for you and for your children and for your protection. As using a tax preparer, you got to have that. That’s why you’re using a professional like myself who has these things in place. It protects your data.

Another area that fits right in with electronic data protection is drive encryption. Is the hard drive of the computers used for tax preparation in the office or used for storing any type of client data, is that hard drive encrypted? It’s not just saying, “Oh well, I got a Windows password.” No, it goes beyond that. You can ask your tax preparer, “Your computers, when you start them up before they boot up, do they ask for a password?”

This is even more critical than the Windows password because I have passwords on my computer. First, my computer starts up and before it even starts booting it asks for the password which on Windows 10 Professional, which is what we use, it has BitLocker on there, which what that does is that has that drive encryption in it which I have to enter in that password and I have to enter in that password correctly before it even decrypts the drive.

Someone happens to pick up, wants to steal my computers, they have to be able to decrypt the drive. That is another level of protection you got to have or your tax preparer needs to have. It would be something I would ask about before you even go to a tax preparer. “What kind of protection do you have for my data,” which to me is way more important than anything you pay or what you’re going to pay.

How secure is your data? That should be right at the top of your list. How secure is your data going to be at this office because all my data, my whole life is going to be in this computer? How secure is it’s going to be? Through things like drive encryption, anti-virus security software, physical locks, all of these are areas that need to be addressed and it’s important for you to take, keep in mind before you choose someone who’s going to do your taxes. These are absolutely vital.

Does the person have back-ups? Some say, “Well, we got a back-up over here,” but it’s on the same place or it’s in the same building. Where is the back-up? How secure is the back-up? There are certain back-ups that you can do which are perfectly fine, some nice online back-up systems that can be used. Some use some on-premise back-ups, but oftentimes offices have more than one back-up for your system.

That’s another area that it’s important for someone to have. You want to know. Is your data backed-up? Should a disaster happen, is my data going to be secure? Is my data going to be available if a disaster does occur? With the proper back-up, that office can definitely be able to do that, which is why we use various back-up systems ourselves.

We’re going to discuss a little bit more about disaster recovery. When disaster does happen, why that is important and how that fits in with your data security in just a couple of minutes when we return to The Tax Answers Advisor. This is Marcelino Dodge on the Voice America Business Channel.

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Today’s tax and financial environment is constantly changing. Tax laws change rapidly. The traditional reactive approach to tax preparation and taxes no longer works. To deliver the best possible outcomes in today’s world, you need a year-round approach to take advantage of tax law changes and to pay as little tax as possible. Marcelino Dodge of Cash Tracks Financial helps his clients to implement proactive tax strategies throughout the year to limit his clients’ tax liability plus with this year-round approach, clients can increase their cash flow and be as prepared for the future as they can be. E-mail Marcelino at or call (844) 394-4287.

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This is The Tax Answers Advisor with host, Marcelino Dodge. To reach our program today, please call in. The number is 1-866-472-5790. That’s 1-866-472-5790. You may also send an e-mail to Now, back to The Tax Answers Advisor.

Marcelino: Welcome back to The Tax Answers Advisor. I appreciate you sticking around for this next segment here. I am Marcelino Dodge as we continue in our discussion about data security. We’re going to take just a small turn here because as part of data security, at least from my standpoint, is that making sure your data is secure and how do you recover from a disaster.

I bring this topic up here because it is timely. We look at recent wildfires across the country. We look at hurricanes that have hit in some areas. We look at it because in some cases, like in case with hurricanes and some of these fires, how the IRS has extended out due dates for tax returns and tax payments as a result of this. Now that is a very, very generous and very kind that that is done, yet if you’ve lost everything in a disaster, how do you prepare to file your taxes is the question. What can be done to help you?

Best way to deal with a disaster is to prepare ahead of time for that unexpected potential of a disaster. Every area, it’s important to examine what type of disasters are possible in your areas. You live around…you live in parts of California. You have the wildfires and there could be other issues. Even as far as Colorado, we see wildfires that destroyed several homes. You have hurricanes that destroyed some homes and you’ve seen some really bad disasters.

It’s good to kind of examine that and prepare which is vitally important because as a tax preparer myself, I got to think about disasters. In my case, I got to think about the potential of tornadoes. I can think about bad blizzards. I can think of a potential disaster not necessarily a natural disaster, but in my little town here we have two very busy highways. We have lot of trucks going through, some perhaps with hazardous materials. I got to think about the possibility of a hazardous material spill which is a type of disaster.

There are a lot of different areas to have to deal with, to think about. It’s important to make sure that proper recovery is available. Some of that, once again relates back to what I’ve talked about in the last segment about back-ups, about making sure data is backed-up which is important because if you’re in a disaster and you need some information, especially tax information, who are you going to go to?

I would expect that people would go looking to whoever did their tax return to do that, which is the way I look at it, it’s vital that me as a person who’s providing a valuable service to my clients and people who I really care about that I keep this information available which is important also which when we worked together on an annual plan that we worked with is that some of this information we may even have available before we file the tax return because of the back-ups I keep in place which are vital to be able to do that.

Yes, being prepared, having back-ups not just on the premises, but back-ups off the premises through some web services like what I am using to back-up data so that my clients’ data can be available if the unexpected happens because people are just going to need information. As we think about the disasters that can happen and why it is important to be able to keep your information safe, keep it secure so that if needed, you can get it. Very, very simple.

What we want to think about is in a disaster, when a disaster occurs, it’s not a matter of if, it’s a matter of when a disaster occurs it’s just absolutely essential that you got to be on guard. Simply stated, you got to be on guard. You look at whether it’s wildfires, hurricanes, tornadoes, whatever part of the country you’re in. There are people and it’s really sad; there are people who pretend they’re from a charity and they’re trying to get data.

They’re calling you perhaps to say, “Okay, can you donate to this charity?” Oftentimes, they’re just wanting to get your personal information because basically they want to steal it and that’s just really sad. The other sad consequence of disasters is bogus websites. Websites set up that could look like maybe a very reputable charity, but yet is false and it’s a company and it’s someone out there just looking to take advantage of someone’s generosity, which again is very sad.

The biggest one I’m going to give a warning about is with one’s call and that’s oftentimes how it’s done is through a call, can maybe done through an e-mail is where people or individuals pretend to be from the IRS. That is just plain fraudulent when ones pretend to be from the IRS. A few points to keep in mind is, when it comes to disaster information, is that the IRS does not contact people via phone in general. In fact, I’ve never really known the IRS to call somebody.

There’s been so many scams out there, not just related to disasters but other areas where ones that call pretending to be from the IRS saying, “We’re sending the sheriff after you if you don’t pay X amount of dollars.” The IRS just doesn’t do that. Of course, as I mentioned earlier, some balance due notices are being sent out by the IRS. It takes a lot of time before the IRS may actually call you. Yes, don’t ever accept any calls from someone who claims to be from the IRS.

The other part with that is that when you talk to speak to someone from the IRS and I’ve had the opportunity to do so several times is that they always give you some type of badge number or ID number as well as explain plainly who they are. The ones I’ve talked to from the IRS and I’ve been fortunate. I’ve spoken to a lot of very nice people, very nice, very hardworking people, but I’ve always called them.

Yes, after a disaster if you get any of these calls or solicitations from someone claiming to be from the IRS, just hang up, tear it up or if you feel like needing an opinion on the information, you can always contact your tax preparer. I’ve had a few people, individuals call me because I work really closely with my clients trying to help them understand various tax information and I just let them know that no, that is not a legitimate IRS communication and then we just move on.

You oftentimes…what we’d like to do as a result of a disaster is we like to make a contribution, but then who do we contribute to? We got to make a choice. When we do want to make a contribution, I recommend, and it’s basically needed especially if you’re thinking about taking any type of deduction for it, you need to make sure that if you make a contribution to a charity, a legitimate charity, you need to do so by either check or credit card because you need to have the receipt.

A few years back the IRS made some changes that you cannot count cash, basically or you have to have some type of receipt. If you give cash, you have to have some receipts. Many years ago, since that change was made, I’ve been recommending to clients, “If you’re going to donate, make sure it’s in a check or a credit card so you have the immediate receipt.”

The secondary part of that is that if you donate more than $250 in a day, you need to get some type of acknowledgement from the charity. Many charities are good at giving you that acknowledgement. Although you may need to remind some occasionally or you may need to request it, but you definitely need to have that on hand if you want to try to deduct that because some states even if you or perhaps not able to take the charity deduction on your federal return because of the itemized deduction, some states let you take a deduction.

For example Colorado, if you donate more than $500 to a verifiable charity, if you didn’t claim anything on the federal return, you can claim it. You can claim anything above $500 on your Colorado state return, very nice provision.

This year we do have a change because of the Cares Act that you can claim a $300 above-the-line deduction for charitable donations on your federal tax return. I’m sure I’ll have several people that will take advantage of that. That’s not a big deduction, but it’s there. It’s something to take advantage of if you have it.

If you’re looking for an organization that you can use or that you would really like to make a donation to, I recommend that you go to and search for exempt organizations. There they have qualified 501(c)(3) organizations and those are the ones that you could more than likely take a deduction with.

It’s very important to think about that in event of a disaster or if you’re just wanting to makes some type of donation in general, making sure that you do make a contribution to a charity that you can actually take a federal tax deduction for.

That’s some ideas when it comes to disaster of how we need to just keep in mind of how important it is to be ready. To have yourself financially ready, make sure for your tax preparer that they’re ready as well by having the proper information.

We’re going to touch base on a few more things when we come back in just a couple of minutes here. This is Marcelino Dodge on The Tax Answers Advisor on the Voice America Business Channel.

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Today’s tax and financial environment is constantly changing. Tax laws change rapidly. The traditional reactive approach to tax preparation and taxes no longer works. To deliver the best possible outcomes in today’s world, you need a year-round approach to take advantage of tax law changes and to pay as little tax as possible. Marcelino Dodge of Cash Tracks Financial helps his clients to implement proactive tax strategies throughout the year to limit his clients’ tax liability plus with this year-round approach, clients can increase their cash flow and be as prepared for the future as they can be. E-mail Marcelino at or call (844) 394-4287.

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This is The Tax Answers Advisor with host, Marcelino Dodge. To reach our program today, please call in. The number is 1-866-472-5790. That’s 1-866-472-5790. You may also send an e-mail to Now, back to The Tax Answers Advisor.

Marcelino: Welcome back to The Tax Answers Advisor. I am Marcelino Dodge and I do truly appreciate you coming back for this final segment of today’s show that has been very exciting because it’s a topic that for me as a tax professional is perhaps even more important than actually doing the tax return and that is protecting my clients’ data and I’m hoping that those who listened to the show today will really be asking the question to their tax preparation person: how secure is my data in your office? What procedures are you taking to protect my data from theft?

Yes, we’ve covered many areas today on how important it is that you know a privacy policy that your tax preparer has and because it applies to the tax industry just as much as it applies to banks or insurance institutions, all of those. It’s vital that you know what the privacy policy of whoever doing your income tax return because it’s required by law, basically. It’s not a suggestion for tax preparers. It is a law. It needs to be deployed and it needs to be there. It’s important that you be aware of this.

Along with this, I do give the little warning here that what we do in my office and what I’m sure many tax preparing offices do is that they prepare as absolutely best they can. They take absolutely every security precaution, but there’s no 100 percent fool-proof plan. We can take every single precaution that we can to protect our client data.

That’s where you as a taxpayer need to be confident in wherever you put your information or whoever you share your information with for the purposes of tax preparation or for the purposes of other problem solving in financial matters, help with your cash flow that your information with that office will be secure. In some cases, it can even be with an office of only providing authorized access to certain people within an office there.

I actually have some areas in my office, some information that is not shared with my assistant and thus, there are different safeguards in place in software and also in desks. That information that my assistant doesn’t have access to because the client chooses that that’s what they want so I respect what the choice of what my client is in the matter.

Of course, every year I do notify my clients when they get their tax return that they have a privacy policy. We let them know that their data is protected so that they, again could be confident that what they have, the information that we have there.

I’m going to mention this part again here because to me it is just so, so important that I recommend avoid using any individual for tax preparation that does not sign the tax return. It especially includes those who say, they’ll do it for 50 bucks, hundred bucks, whatever, they do it cheaply, but that old saying “you get what you pay for.” You could be compromising your data by using one of these, once again it’s termed in the business, a “ghost preparer.”

Not only you may be having your tax return not prepared right, but once again, you could be compromising your data just by giving your data to that person. They may give everything back, but see the problem is they still entered that into some type of software that they used with a 99 percent chance they’re not signing your tax return. They took some money, but they’re not taking responsibility for it.

Again, I just really strongly warn against using such people who says, “Oh, I can do that for you.” No, don’t do that. That’s not good for you. It’s not good for the tax industry. It’s not good for data security. You’re really putting yourself at risk with doing so. It just is not a good idea to do that.

Paying close attention to what the office security procedures are within an office. Do they lock their file cabinets at night? Do they lock their desks at night? It’s just all of these little vital things. Have they background checked the employees working in their office? Just some little thoughts so that you know and you can have confidence that when you come to this office or you do business with this office electronically that yes, my data is secure.

Just thinking about the electronic issues, do they have software security? Yes, we do. We use software security here. We have a very strong system we’re using for data protection, both our physical hard drive. Our network server is very strong. We do our very best there. We keep in good drive encryption in our system so that the hard drives are always encrypted so that data will not be compromised if the drive for example gets left in the office. The data is secure in that manner and even of course our security software in place that keeps the viruses out, keeps the malware out.

More important than all of that as I work here and what needs to really be done is making sure that all employees understand the importance of security for clients, understand compliance, understand client safety and client confidentiality.

All of these are vital and any data protection that is done which is why in this office it is absolutely stressed — client protection, client privacy. We do that. We back it up. We practice that on every single client there. It’s absolutely essential your data be protected. Avoid anyone who will not protect your data or does not provide the necessary precautions for your data to be secure.

Just a little reminder here about being prepared for a disaster, is the office prepared for a disaster? You’re not going to be perfectly prepared, but are there safeguards in place? Are the back-ups in the office ready? Are they there so that if you as my client needs your information, can I get my information? The answer to that question is yes. You’ll be able to get copies of what information we have because we got proper back-ups in place so that your data will be available should that unexpected time happen. In our office we have back-ups.

Of course, if you want to donate to a charity, watch out for scams. We’ve sadly seen a lot of scams over the years and we continue to see them every year when there’s a disaster. I always encourage ones to check for legitimate organizations to be able to do make a donation to.

Again, we are so appreciative of you listening in on the importance of tax data security. I can’t stress it enough. You need to make sure whoever does your tax return, whoever you share your data with it will be secure. This is an office that keeps client information secure.

Again, we thank you for listening to today’s show. Next week we’re going to talk about how to avoid the unemployment surprise. Thanks for listening to The Tax Answers Advisor. I am Marcelino Dodge on the Voice America Business Channel.

Thank you for listening to The Tax Answers Advisor with host, Marcelino Dodge. We’ll be back again next Wednesday at 6:00pm Eastern Time and 3:00pm Pacific Time on the Voice America Business Channel. We’ll have more to share next week.