Tax Season Cybersecurity: 3 Red Flags Every Accounting Firm Must Watch For

Tax season is the Super Bowl for cybercriminals targeting accounting firms. While your team is buried in deadlines, extensions, and client demands, hackers are launching their most sophisticated attacks of the year. They know you're overwhelmed, distracted, and handling the exact data they want: Social Security numbers, bank accounts, W-2s, and complete financial profiles.

Why Accounting Firms Are Prime Targets

Accounting firms handle what cybercriminals call "the holy grail" of data. A single breach can expose hundreds of clients' complete financial identities: names, addresses, Social Security numbers, income details, banking information, investment accounts, and dependents' data. This information is worth far more on the black market than credit card numbers or email passwords.

But the real reason accounting firms get targeted during tax season isn't just the data. It's the conditions. Tax season creates the perfect storm:

High stress and tight deadlines: Staff are working long hours, rushing through emails, and prioritizing speed over caution.

Increased email volume: Clients send documents, questions, and requests constantly, making it harder to spot fake messages.

Temporary staff and contractors: Many firms bring in seasonal help who may not be trained on security protocols.

Constant pressure to respond quickly: When clients need something urgently, employees skip verification steps.

Hackers know this. They time their attacks to exploit exhaustion, urgency, and the chaos of tax season. And they're getting better every year.

Red Flag #1: The "Urgent" Client Email That Isn't From Your Client

The Scenario: It's March 28th. You're three weeks from the deadline. An email comes in from a long-time client's email address asking you to review an "updated W-2" attached as a PDF. The subject line says "URGENT - Need to file by Friday." The email tone matches how your client usually writes. You open it.

Except it's not from your client. It's from a hacker who spoofed their email address. The attachment isn't a W-2. It's malware designed to give the attacker access to your network.

What to watch for:

• Emails that create urgency or pressure you to act immediately
• Requests for sensitive information via email (real clients know better)
• Unexpected attachments, even from known contacts
• Slight variations in the sender's email address (john@clientcompany.com vs. john@clientcompany.co)
• Generic greetings ("Dear Client" instead of your actual name)

What actually works: Don't trust the email address. Call the client using a number you already have on file (not one from the email). Verify the request before opening any attachment or clicking any link. And train your team to do the same, even during the busiest weeks.

Red Flag #2: The "IRS" or "State Tax Authority" Email That Demands Immediate Action

The Scenario: An email arrives claiming to be from the IRS or your state's Department of Revenue. It says there's a problem with a client's return, an audit has been triggered, or immediate action is required to avoid penalties. It includes official-looking logos, case numbers, and a link to "verify the information" or "resolve the issue."

The IRS does not initiate contact via email. Neither do most state tax authorities. These emails are phishing attempts designed to steal credentials or install malware.

What to watch for:

• Any email claiming to be from the IRS or state tax agency (they don't email taxpayers or preparers)
• Threats of immediate penalties, audits, or legal action
• Links that ask you to log in or verify information
• Requests for personal information, passwords, or account access
• Emails with poor grammar or unusual phrasing (though AI has made this harder to spot)

What actually works: Delete the email immediately. If you're concerned about a legitimate issue, go directly to the IRS or state agency's official website (don't click links in the email) or call their verified phone number. And make sure your entire team knows that government agencies don't operate via email.

Red Flag #3: The Employee Who Just "Needs to Reset Their Password" From Home

The Scenario: A team member is working remotely and sends a message saying they can't access their account. They need their password reset immediately so they can finish a return that's due tomorrow. It seems reasonable—people forget passwords all the time, especially when they're stressed and overworked.

Except the message didn't come from your employee. It came from a hacker who compromised their email or is impersonating them. Once you reset the password and send it via email or text, the attacker has full access to your systems.

What to watch for:

• Password reset requests via email, text, or messaging apps
• Requests from employees who are "working remotely" without prior notice
• Urgency around access issues ("I need this right now or we'll miss the deadline")
• Employees asking for credentials to be sent via insecure methods

What actually works: Never reset passwords or provide credentials based solely on an email or text request. Always verify the person's identity with a phone call (using a number you already have, not one provided in the message). Better yet, implement multi-factor authentication (MFA) so that even if credentials are stolen, attackers can't get in.

Why Traditional Training Doesn't Work During Tax Season

Most accounting firms require annual cybersecurity training. Employees watch a video, take a quiz, and check the box. Then tax season hits, and everything they learned goes out the window because the real-world pressure to respond quickly overrides their training.

The firms that successfully protect client data during tax season don't rely on annual training. They use ongoing simulated phishing campaigns that test employees in real time, during actual busy periods, with scenarios that mirror the exact threats they'll face.

When an employee clicks a simulated phishing link, they get immediate feedback explaining what they missed and why it mattered. Over time, this builds genuine awareness and changes behavior in ways that annual training videos never will.

The Cost of Getting It Wrong

When an accounting firm suffers a data breach during tax season, the damage compounds quickly:

Immediate costs: Forensic investigation, legal fees, credit monitoring for affected clients, regulatory fines, and notification expenses.

Long-term costs: Lost clients, damaged reputation, increased insurance premiums, and potential lawsuits.

Operational costs: Time spent responding to the breach instead of serving clients, missed deadlines, and staff overtime to recover.

The average cost of a data breach for a small to mid-sized business is between $200,000 and $3 million. For accounting firms, where trust is everything, the reputational damage can be even more devastating than the financial cost.

What High-Performing Firms Do Differently

The accounting firms that make it through tax season without incident aren't the ones with the most sophisticated technology. They're the ones with the best habits, clearest protocols, and most consistent training:

They verify before they act: Every request for sensitive information or urgent action gets verified with a phone call.

They use multi-factor authentication: Even if credentials are stolen, attackers can't access systems without the second factor.

They run simulated phishing campaigns: Employees are tested regularly with realistic scenarios that mirror actual threats.

They segment their networks: Client data is isolated from general office systems to limit exposure if a breach occurs.

They monitor constantly: 24/7 security monitoring catches suspicious activity before it becomes a full breach.

They have an incident response plan: When something does go wrong, they know exactly what to do and who to call.

The Reality Check Every Firm Needs

If you're reading this and thinking "we're fine, this won't happen to us," consider this: most firms that suffer breaches thought the same thing. They had antivirus software. They had a firewall. They told employees to be careful. And they still got compromised.

The firms that stay secure are the ones that assume they're already a target, train accordingly, and implement systems that catch threats even when employees make mistakes— because during tax season, mistakes are inevitable.

Experience a Phishing Simulation and Awareness Training Demo

See exactly how vulnerable your team is right now. We'll run a simulated phishing campaign and show you who clicked, who reported it, and how we turn those results into meaningful training that actually sticks.

What's included:

• Customized phishing simulation designed for accounting firms
• Detailed reporting on employee responses
• Immediate training for anyone who clicks
• Recommendations for ongoing security awareness programs
• No obligation and no sales pressure

Call (847) 398-5870 or visit pulsetechnology.com to schedule your demo. Because the best time to test your defenses is before tax season starts, not after something goes wrong.