Accounting
It’s time to get your WISP in order
Tax Season 2025 is approaching and, in case you missed it, recent updates to the Written Information Security Plan requirements have introduced additional complexities to the process. It’s crucial for accounting firms and tax preparers to reassess their current strategies with these changes in mind. The implications of non-compliance are significant, with potential consequences that could significantly impact your business. As we approach tax season, make sure you stay informed and ensure your WISP is robust and up to date.
WISPs and PTINs
The Preparer Tax Identification Number renewal and WISP compliance connection aren’t new. However,
That means every year, when you check off “WISP” before the
In
- Enhanced risk assessment protocols:
- Stricter data encryption standards;
- Comprehensive incident response planning: and,
- Expanded employee training requirements;
Consequences of noncompliance
The WISP requirement aligns with the
“The Gramm-Leach-Bliley Act (GLBA) is a US law that requires financial institutions to protect customer data,” says
Failing to have a WISP in place can result in:
- Inability to renew your PTIN, affecting the ability to prepare tax returns for clients;
- Legal penalties and disciplinary actions by the IRS; and,
- Increased vulnerability to data breaches, which can lead to financial and reputational damage.
Though this might seem overwhelming, there is good news. To help simplify the road to compliance, several organizations offer WISP templates with varying features and levels of specialization. Some of these tools are free, some are not, some are made for accountants while others are more general, and some are specifically IRS compliant while others are partially so, but all can be used to help get a handle on WISPs. They include:
IRS Publication 5708 Practice Protect CPACharge SANS Institute AICPA-CIMA Tech4Accountants Rightworks WISP
Compliance timeline
The PTIN renewal deadline of December 31 serves as a critical checkpoint for WISP compliance, but effective security planning requires a year-round commitment. Firms should begin their review and update process well in advance of the deadline to ensure adequate time for implementation, testing, and staff training.
Key compliance elements:
- Annual WISP review and updates with quarterly assessments of emerging security threats;
- Comprehensive documentation of all security protocols, including access controls and data handling procedures;
- Regular employee training sessions, with mandatory updates for new hires and refresher courses for existing staff;
- Incident response plan testing through simulated security breaches and response drills;
- System security audits covering both internal networks and third-party vendor integrations;
- Regular backup testing and disaster recovery plan validation; and,
- Periodic review of user access privileges and authentication protocols.
Your clients deserve secure data
A current, compliant security plan represents more than regulatory compliance—it demonstrates your firm’s commitment to protecting client data and maintaining professional standards. How you handle your clients’ sensitive financial and personal information is fundamental to your firm’s relationships and reputation.
The most successful firms approach WISP compliance not as a burden but as an opportunity to strengthen client relationships and differentiate their services.
So, as we approach Tax Season 2025, ensure you remain up-to-date, compliant and secure with your firm’s data. This is not only a critical aspect of professional tax preparation services but also a standard your clients rightfully expect.
Easing restrictions, sharpening personal attention and clarifying denials are among the aims of
The programs focus on “fast track settlement,” which allows IRS Appeals to mediate disputes between a taxpayer and the IRS while the case is still within the jurisdiction of the examination function, and post-appeals mediation, in which a mediator is introduced to help foster a settlement between Appeals and the taxpayer.
The IRS has been revitalizing existing ADR programs as part of transformation efforts of the agency’s new strategic plan, said Elizabeth Askey, chief of the IRS Independent Office of Appeals.
“By increasing awareness, changing and revitalizing existing programs and piloting new approaches, we hope to make our ADR programs, such as fast-track settlement and post-appeals mediation, more attractive and accessible for all eligible parties,” said Michael Baillif, director of Appeals’ ADR Program Management Office.
Among other improvements, the pilots:
- Align the Large Business and International, Small Business and Self-Employed and Tax Exempt and Government Entities divisions in offering FTS issue by issue. Previously, if a taxpayer had one issue ineligible for FTS, the entire case was ineligible.
- Provide that requests to participate in FTS and PAM will not be denied without the approval of a first-line executive.
- Clarify that taxpayers receive an explanation when requests for FTS or PAM are denied.
Another pilot, Last Chance FTS, is a limited scope SB/SE pilot in which Appeals will call taxpayers or their representatives after a protest is filed in response to a 30-day or equivalent letter to inform taxpayers about the potential application of FTS. This pilot will not impact eligibility for FTS but will simply test the awareness of taxpayers regarding the availability of FTS.
A final pilot removes the limitation that participation in FTS would preclude eligibility for PAM.
The traditional appeals process remains available for all taxpayers.
Inquiries can be addressed to the ADR Program Management Office at
The Internal Revenue Service has updated and added new guidance for taxpayers claiming the Energy Efficient Home Improvement Credit and the Residential Clean Energy Property Credit.
The updated
New sections have been added on how long a taxpayer has to claim the tax credits, guidance for condominium and co-op owners, whether taxpayers who did not previously claim the credit can file an amended return to claim it, and a series of questions on qualified manufacturers and product identification numbers. Other material has been added on how to claim the credits, what kind of records a taxpayer has to keep for claiming the credit, and for how long, and whether taxpayers can include financing costs such as interest payments in determining the amount of the credit.
The IRS states that “financing costs such as interest, as well as other miscellaneous costs such as origination fees and the cost of an extended warranty, are not eligible expenditures for purposes of the credit.”
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