EFIN Security Requirements: Essential Steps for Tax Professionals

EFIN security requirements are federal mandates that govern how tax professionals protect their Electronic Filing Identification Numbers (EFINs) from unauthorized access and fraudulent use. According to the IRS, an EFIN serves as the unique identifier that authorizes tax preparation firms to electronically submit returns, and its compromise can result in thousands of fraudulent filings, permanent revocation of e-filing privileges, and potential criminal liability. The IRS requires EFIN holders to implement specific technical controls including multi-factor authentication, encrypted credential storage, weekly usage monitoring, and immediate breach reporting to maintain their authorization status under IRS Publication 4557 and the IRS e-file Security and Privacy Standards (Publication 1345).

In 2025, EFIN-related fraud continues to threaten tax preparation businesses, with cybercriminals specifically targeting these credentials to file mass fraudulent returns during tax season. The average data breach in the financial services sector now costs $6.08 million according to IBM’s Cost of a Data Breach Report, and compromised EFINs frequently result in complete business shutdowns due to permanent IRS sanctions. Understanding and implementing comprehensive EFIN security requirements is not optional—it’s a critical compliance mandate that determines whether your practice survives the increasingly sophisticated threat landscape.

Understanding Electronic Filing Identification Numbers and Federal Requirements

What Is an EFIN and Its Regulatory Purpose

An Electronic Filing Identification Number (EFIN) is a unique six-digit identifier assigned by the IRS to firms and individuals authorized to electronically file federal tax returns. Unlike a Preparer Tax Identification Number (PTIN), which identifies individual preparers, an EFIN belongs to the business entity—either associated with the firm’s Employer Identification Number (EIN) or a sole proprietor’s Social Security Number (SSN). The EFIN system was established to enhance security, prevent fraud, and enable the IRS to track e-filing volume across authorized providers.

According to the IRS EFIN FAQ, the firm that owns the EFIN must designate a Principal (the business owner or officer with 5% or greater ownership), a Responsible Official (who oversees e-file operations), and a Primary Contact. Each of these individuals undergoes IRS suitability checks that include credit verification, tax compliance review, criminal background checks, and prior e-file compliance history. The application process typically takes 4-6 weeks but can extend to 45 days during peak filing season.

The Value of EFINs to Cybercriminals

Compromised EFINs represent one of the highest-value targets in tax-related cybercrime. A single stolen EFIN enables criminals to:

• File thousands of fraudulent returns: Submit fake returns claiming illegitimate refunds at scale before detection
• Access sensitive taxpayer data: Exfiltrate Personally Identifiable Information (PII) for identity theft
• Launder criminal proceeds: Direct fraudulent refunds to prepaid cards or money mule networks
• Destroy legitimate businesses: Trigger permanent EFIN revocation that ends the victim’s e-filing capability

The IRS reports that EFIN compromise incidents spike during tax season, with sophisticated phishing campaigns, malware attacks, and social engineering specifically targeting tax professionals. Once compromised, an EFIN may be used to file hundreds or thousands of returns within hours, generating millions in fraudulent refunds before the legitimate EFIN holder discovers the breach through IRS notifications or client complaints about duplicate filings.

The IRS e-file program has transmitted more than one billion tax returns since 1990, with over 90 percent of all individual federal returns now filed electronically. This massive volume makes EFIN security a critical national cybersecurity priority. – IRS e-file Provider Statistics

Mandatory IRS EFIN Security Requirements and Compliance Standards

Core Security Controls Required by the IRS

The IRS mandates specific EFIN security requirements through Publication 4557 (Safeguarding Taxpayer Data) and Publication 1345 (IRS e-file Security and Privacy Standards). These requirements establish baseline security controls that all authorized e-file providers must implement:

1. Secure Credential Storage and Access Control

• Never store EFIN in plain text: Credentials must not appear in spreadsheets, unencrypted documents, or email
• Use encrypted password vaults: Deploy enterprise password managers with AES-256 encryption
• Implement least-privilege access: Grant EFIN access only to essential personnel with documented business need
• Maintain access audit logs: Record all instances of EFIN credential viewing or use with timestamps and user identification
• Enforce physical security: Store printed EFIN documentation in locked, access-controlled areas

2. Multi-Factor Authentication Requirements

Multi-factor authentication (MFA) is mandatory for all systems that access or store EFIN credentials. The IRS requires:

• IRS e-Services accounts: Must enable MFA using the IRS Secure Access platform
• Tax software systems: Configure MFA for all users with EFIN access privileges
• Email accounts: Implement MFA on all email addresses associated with EFIN applications and IRS communications
• Authentication method preferences: Use app-based authenticators (Google Authenticator, Microsoft Authenticator) or hardware security keys rather than SMS-based codes, which are vulnerable to SIM-swapping attacks

For comprehensive guidance on implementing MFA across your tax practice, review our 2025 Cybersecurity Compliance Guide for Tax Professionals.

3. Weekly EFIN Monitoring and Anomaly Detection

The IRS provides weekly EFIN usage reports through the e-Services EFIN Status page. EFIN holders must:

• Review reports weekly: Check filing volumes, return types, and acknowledgment counts every seven days minimum
• Establish baseline patterns: Document normal filing volumes by week, return type distribution, and geographic patterns
• Investigate anomalies immediately: Any unexpected spikes, off-hours filings, or unusual geographic distributions require immediate investigation
• Report suspicious activity: Contact the IRS e-help desk (866-255-0654) immediately upon detecting unauthorized use
• Reconcile acknowledgments: Compare IRS acknowledgment counts against your internal filing records to identify discrepancies

Application and Renewal Security Procedures

EFIN security begins during the initial application process and continues through ongoing maintenance. According to the IRS EFIN maintenance guidance, providers must:

• Apply through official channels only: Submit applications exclusively via IRS e-Services using encrypted HTTPS connections
• Complete enhanced identity verification: Principals without professional credentials (CPA, EA, attorney) must complete Livescan electronic fingerprinting at authorized locations
• Maintain current information: Update the IRS within 30 days of any changes to business structure, ownership, principals, address, or contact information
• Undergo annual suitability reviews: Ensure all listed principals maintain clean tax compliance and criminal records
• Renew timely: While EFINs don’t technically expire, the e-Services account and associated credentials require regular validation and may need renewal if account access lapses

Organizations purchasing an existing tax practice cannot transfer the previous owner’s EFIN. The new ownership must apply for a new EFIN, which can take up to 45 days—a critical consideration when planning practice transitions.

Threat Landscape: Common Attacks Targeting EFIN Credentials

Sophisticated Phishing Campaigns

Phishing attacks specifically targeting tax professionals intensify during filing season, employing increasingly sophisticated social engineering tactics. Common EFIN security threats include:

• Fake IRS correspondence: Emails purporting to be from the IRS claiming EFIN suspension, required verification, or mandatory security updates
• Tax software impersonation: Messages mimicking legitimate software vendors requesting EFIN re-entry for “system updates” or “security verification”
• Client impersonation attacks: Criminals posing as clients with urgent requests that trick staff into revealing system access credentials
• Vendor spoofing: Fake communications from service providers requesting login credentials for “account verification” or “compliance checks”
• Business email compromise (BEC): Compromised or spoofed email accounts of partners or managers requesting EFIN information from staff

Learn advanced defense strategies in our comprehensive guide on Guarding Against Advanced Phishing Attacks for Tax Professionals.

Malware and Credential Theft

Specialized malware families target tax preparation environments to steal EFIN credentials and taxpayer data:

• Tax software trojans: Malware disguised as legitimate tax software updates, utilities, or plugins that capture EFIN credentials during entry
• Keylogging software: Programs that record all keyboard input, capturing EFIN, passwords, and client data as it’s typed
• Screen capture malware: Software that takes screenshots when tax applications are active, capturing credentials and sensitive data visible on screen
• Memory scrapers: Advanced malware that extracts credentials directly from system RAM, bypassing encrypted storage
• Remote access trojans (RATs): Malware providing attackers real-time control of infected systems to access EFIN credentials and file fraudulent returns

Traditional signature-based antivirus solutions are insufficient against modern malware threats. Review our analysis of why endpoint detection and response (EDR) has replaced legacy antivirus for protecting sensitive credentials.

Insider Threats and Access Control Failures

Not all EFIN security requirements address external threats—internal risks pose significant danger:

• Disgruntled employees: Current or former staff with EFIN access who intentionally misuse credentials
• Inadequate offboarding: Terminated employees retaining system access due to incomplete access revocation procedures
• Credential sharing: Well-intentioned staff sharing logins for convenience, violating least-privilege principles
• Social engineering of employees: Staff tricked into revealing EFIN information through phone calls, emails, or in-person impersonation
• Negligent handling: Accidental exposure of EFIN credentials through insecure storage, unattended workstations, or improper document disposal

Technical Security Controls for EFIN Protection

Network Security Architecture

Implementing robust network controls protects systems that access your EFIN and ensures compliance with federal security standards:

1. Network Segmentation

• Isolate tax systems: Separate tax preparation systems from general office networks using VLANs or physical segmentation
• Client-facing separation: Keep client-facing systems (websites, portals) on separate network segments from EFIN access points
• Administrative jump boxes: Implement dedicated, hardened systems for administrative access to critical EFIN infrastructure
• Zero-trust architecture: Assume no implicit trust and verify every access request regardless of network location

2. Firewall and Intrusion Prevention

• Strict outbound rules: Configure firewalls to allow connections only to IRS systems, verified software vendor domains, and essential business services
• Port restrictions: Block all unnecessary ports and protocols, permitting only required services
• Intrusion detection systems (IDS): Deploy network-based IDS to identify suspicious traffic patterns
• Intrusion prevention systems (IPS): Implement IPS to automatically block detected threats
• Comprehensive logging: Log all access attempts to EFIN-related systems with retention periods meeting IRS Publication 4557 requirements (minimum six years)

3. Secure Remote Access

• Mandatory VPN: Require VPN connections for all remote access to systems handling EFIN credentials
• Certificate-based authentication: Implement certificate-based VPN authentication in addition to passwords
• Split-tunneling policies: Configure VPN to route only business traffic through the encrypted tunnel
• Geographic restrictions: Consider blocking VPN access from high-risk countries if your business has no legitimate need for international access
• Access logging and monitoring: Monitor VPN logs for unusual access patterns, off-hours connections, or impossible travel scenarios

Endpoint Protection Requirements

Every device that accesses your EFIN must implement comprehensive endpoint security controls:

• Endpoint Detection and Response (EDR): Deploy advanced EDR solutions that detect and prevent credential theft attempts through behavioral analysis, not just signature matching
• Application whitelisting: Configure systems to run only approved tax software and essential business applications
• USB port controls: Disable or monitor USB ports to prevent data exfiltration via removable media
• Full disk encryption: Encrypt all devices that may store or access EFIN credentials using BitLocker (Windows), FileVault (macOS), or equivalent solutions
• Mobile device management (MDM): If EFIN access occurs from mobile devices, deploy MDM solutions to enforce security policies and enable remote wipe capabilities
• Automatic updates: Configure operating systems and software for automatic security updates to address known vulnerabilities

For detailed implementation guidance on encryption technologies, see our guides on IRS data security standards and encryption requirements.

Access Control and Authentication Framework

Implement strict access controls as fundamental EFIN security requirements:

1. Principle of Least Privilege

• Minimal EFIN access: Grant EFIN access only to staff with absolute business need—typically principals, responsible officials, and designated senior preparers
• Role-based access control (RBAC): Configure tax software with role-based permissions limiting EFIN access by job function
• Time-based access: Implement temporary access grants for seasonal employees that automatically expire
• Manager approval workflows: Require supervisor approval for all new EFIN access requests with documented business justification

2. Strong Authentication Standards

• Complex password requirements: Enforce minimum 14-character passwords with mixed case, numbers, and special characters
• Regular password rotation: Require password changes every 60 days during tax season, 90 days off-season
• Biometric authentication: Deploy fingerprint or facial recognition where hardware supports it
• Hardware security keys: Use FIDO2-compliant hardware keys for high-privilege accounts with EFIN access
• Unique credentials: Never share credentials; ensure each user has individual login credentials for accountability

3. Session Management

• Automatic timeouts: Configure automatic logouts after 10 minutes of inactivity on systems with EFIN access
• Prevent concurrent sessions: Prohibit multiple simultaneous logins with identical credentials
• Comprehensive access logging: Record all EFIN access with timestamp, user identification, and system details
• Geographic anomaly alerts: Generate alerts when access attempts originate from unusual or new locations

EFIN Usage Monitoring and Anomaly Detection Procedures

Establishing Weekly Monitoring Protocols

The IRS provides weekly EFIN usage reports through the e-Services EFIN Status page. Effective monitoring requires systematic procedures:

1. Baseline Pattern Documentation

• Weekly volume tracking: Document typical filing volumes by week throughout the tax season and off-season periods
• Return type distribution: Record the percentage breakdown of return types (1040, 1040-SR, 1065, 1120, 1120S, 990, etc.) your practice typically files
• Seasonal variations: Note expected spikes during January-April tax season, October extension season, and year-end planning periods
• Geographic patterns: If your practice serves specific regions, document typical geographic distribution of filed returns
• Time-of-day patterns: Establish normal business hours for filing activity to identify after-hours anomalies

2. Red Flag Indicators

Investigate immediately when weekly monitoring reveals:

• Volume spikes: Sudden increases of 20% or more over baseline weekly volumes without corresponding client intake
• Off-hours filings: Returns filed during nights, weekends, or holidays when your office is closed
• Geographic anomalies: Filings from states or regions where your practice has no clients
• Return type shifts: Unexpected changes in return type distribution (e.g., sudden surge in 1040s if you primarily file business returns)
• Refund patterns: Multiple returns with similar refund amounts, suggesting automated fraudulent filing
• Acknowledgment mismatches: Discrepancies between IRS acknowledgment counts and your internal filing records
• Rejection rate changes: Sudden increases in return rejections may indicate fraudulent filings with invalid data

3. Immediate Response Procedures

When anomalies are detected:

1. Secure all credentials immediately: Change passwords for EFIN access, IRS e-Services, tax software, and associated email accounts
2. Contact IRS e-help desk: Call 866-255-0654 during business hours (6:30 AM – 6:00 PM Central) to report suspected compromise
3. Review system access logs: Examine logs for unauthorized access attempts, unusual login locations, or suspicious activity
4. Consider temporary suspension: Request voluntary EFIN suspension from the IRS while investigating the incident
5. Document everything: Create detailed incident documentation including timeline, detected anomalies, and response actions taken

Automated Monitoring Solutions

Technology can enhance manual monitoring processes:

• Security Information and Event Management (SIEM): Feed EFIN usage data and system logs into SIEM platforms for correlation analysis
• Custom alert configuration: Create automated alerts triggered by specific thresholds (volume spikes, off-hours access, geographic anomalies)
• API monitoring: Track all API calls to tax software that utilize your EFIN, logging each transaction with metadata
• Behavioral analytics: Implement machine learning models that establish normal patterns and flag deviations automatically
• Dashboard visualization: Deploy real-time dashboards displaying filing volume, return types, and key security metrics

Incident Response: Handling EFIN Compromise

Immediate Containment Actions (First 60 Minutes)

Speed is critical when EFIN security requirements are breached. The first hour determines incident severity:

1. Disable tax software access: Immediately disable all user access to tax preparation software and systems that store or transmit EFIN credentials
2. Change all passwords: Reset passwords for IRS e-Services, tax software, email accounts, and any system that may contain or access EFIN information
3. Update MFA settings: Regenerate multi-factor authentication codes and revoke existing sessions
4. Network isolation: Disconnect suspected compromised systems from the network to prevent lateral movement
5. Begin documentation: Create an incident log recording all actions taken with timestamps and personnel involved
6. Preserve evidence: Do not delete logs, files, or system data that may be needed for investigation

Assessment Phase (Hours 2-4)

• Review EFIN usage reports: Analyze recent IRS EFIN Status reports for unauthorized filings, noting dates, volumes, and return types
• Examine system logs: Review authentication logs, file access logs, and network logs for indicators of compromise
• Identify affected data: Determine which client records may have been accessed or exfiltrated
• Engage incident response: Contact your incident response team, cybersecurity consultant, or managed security services provider
• Assess scope: Determine whether the breach is limited to EFIN compromise or includes broader network intrusion

Notification and Remediation (Hours 4-24)

1. Contact IRS e-help desk: Report the compromise to the IRS immediately at 866-255-0654
2. File official IRS report: Submit a detailed report through IRS Secure Access documenting the incident
3. Notify cyber insurance: Contact your cyber liability insurance carrier to initiate a claim
4. Prepare client notifications: If client data was accessed, prepare breach notification letters as required by state and federal data breach laws
5. Law enforcement coordination: File a report with local law enforcement and consider FBI notification for large-scale fraud
6. Credit monitoring offers: Arrange credit monitoring services for affected clients if PII was compromised

Working with the IRS During Compromise Investigations

The IRS has established procedures for EFIN compromise situations:

• Emergency EFIN suspension: The IRS may immediately suspend your EFIN to prevent further unauthorized use. You can also request voluntary suspension during investigation.
• IRS Criminal Investigation cooperation: Provide complete cooperation with IRS-CI agents, supplying all requested information, logs, and documentation
• EFIN replacement process: After security is restored and documented, work with the IRS to obtain a new EFIN. This requires demonstrating that vulnerabilities have been remediated.
• Enhanced security review: Expect the IRS to conduct a thorough review of your security measures before reactivating or reissuing an EFIN
• Ongoing monitoring requirements: The IRS may impose enhanced monitoring requirements as a condition of EFIN reissuance

Long-Term EFIN Security Best Practices

Building a Security-First Organizational Culture

Sustainable EFIN security requirements demand organization-wide commitment aligned with broader compliance frameworks including the FTC Safeguards Rule:

1. Leadership Engagement

• Executive sponsorship: Designate a senior leader (typically the Principal or Responsible Official) as the security champion
• Budget allocation: Provide adequate resources for security tools, training, and incident response capabilities
• Policy enforcement: Lead by example in following security protocols, including MFA use and clean desk policies
• Regular reviews: Conduct quarterly security policy reviews and annual comprehensive assessments

2. Comprehensive Staff Training Programs

• Annual EFIN-specific training: Conduct dedicated training on EFIN security, covering proper handling, storage, and incident reporting
• Monthly phishing simulations: Run simulated phishing exercises during tax season to maintain staff vigilance
• Clean desk policies: Enforce policies requiring staff to secure all documents containing EFIN information when away from workstations
• Security awareness rewards: Recognize and reward employees who identify and report security threats
• New hire onboarding: Include comprehensive security training in onboarding for all new personnel
• Role-specific training: Provide specialized training for staff with EFIN access covering their specific responsibilities

Explore our cybersecurity training programs for tax professionals designed specifically for practices handling sensitive tax data.

3. Vendor Management and Third-Party Risk

• Security assessments: Vet all third-party software that interfaces with systems storing or accessing EFIN credentials
• SOC 2 attestations: Require tax software vendors to provide current SOC 2 Type II reports demonstrating security controls
• Limit EFIN sharing: Minimize or eliminate EFIN sharing with third-party service providers; when unavoidable, document arrangements and enforce security requirements
• Monitor vendor bulletins: Subscribe to security bulletins from all tax software vendors and apply patches promptly
• Contractual security requirements: Include security and breach notification requirements in all vendor contracts

Documentation and Compliance Management

Maintain comprehensive documentation demonstrating EFIN security compliance:

• Written Information Security Plan (WISP): Document all procedures for EFIN handling, protection, monitoring, and incident response as part of your broader WISP required by the FTC Safeguards Rule
• Access control records: Maintain detailed logs of who has EFIN access, when access was granted, business justification, and access review dates
• Incident documentation: Create and preserve records of all security incidents, even minor ones, including response actions and lessons learned
• Training records: Keep records of all security training completed by staff, including dates, topics covered, and attendance
• Audit trails: Maintain comprehensive audit logs of EFIN usage, system access, and administrative actions for the IRS-required minimum of six years
• Policy version control: Track all versions of security policies with effective dates and change documentation

Federal Compliance Framework Integration

Aligning EFIN Security with Broader Mandates

EFIN security requirements exist within a broader federal cybersecurity compliance framework. Tax professionals must simultaneously comply with:

• IRS Publication 4557: Safeguarding Taxpayer Data requirements for all tax return preparers
• IRS Publication 1345: IRS e-file Security and Privacy Standards for authorized e-file providers
• FTC Safeguards Rule: Requires financial institutions (including tax preparers) to implement comprehensive information security programs
• Gramm-Leach-Bliley Act (GLBA): Mandates security and privacy protections for customer financial information
• State data breach notification laws: Require notification of affected individuals when personal information is compromised

The NIST Cybersecurity Framework provides comprehensive guidance that complements IRS requirements. Additionally, the FTC’s cybersecurity guidance for small businesses and CISA’s cybersecurity best practices offer actionable frameworks for protecting electronic filing systems.

Tax Software Security Features and Evaluation

Your tax software selection directly impacts EFIN security. Evaluate software based on:

• Built-in MFA support: Does the software provide native multi-factor authentication for all users?
• Role-based access controls: Can you implement granular permissions limiting EFIN access by role?
• Audit logging: Does the software provide comprehensive logs of all EFIN usage and filing activity?
• Encryption standards: How does the software encrypt EFIN credentials at rest and in transit?
• Incident detection: Does the software include anomaly detection for unusual filing patterns?
• Vendor security posture: What security certifications and attestations does the vendor maintain?
• Update cadence: How frequently does the vendor release security updates?

For detailed evaluation criteria, review our comprehensive guide to tax software security features and selection best practices.

Emerging Threats and Future EFIN Security Requirements

Advanced Persistent Threats

The threat landscape continues evolving with increasingly sophisticated attacks:

• AI-powered phishing: Machine learning algorithms generate highly convincing phishing emails that mimic legitimate IRS or software vendor communications with unprecedented accuracy
• Supply chain attacks: Criminals compromise tax software vendors or service providers to access multiple EFINs simultaneously, as seen in recent SolarWinds-style attacks
• Deepfake technology: Video or audio impersonation of IRS officials, software vendor support staff, or firm partners used in social engineering attacks
• Quantum computing risks: Future quantum computers threaten current encryption standards, requiring migration to post-quantum cryptography
• Ransomware targeting tax season: Attacks timed to coincide with peak filing season to maximize pressure for ransom payment

IRS Modernization and Enhanced Security Standards

The IRS continues enhancing EFIN security through technology modernization:

• Biometric authentication: Potential future requirements for biometric verification of EFIN holders
• Real-time fraud detection: Development of systems to detect and block fraudulent filings instantly upon submission
• Blockchain verification: Research into blockchain technology for EFIN verification and return authentication
• Enhanced API security: Improved security standards for software integration with IRS systems
• Continuous monitoring: Migration from weekly monitoring to real-time EFIN usage visibility for providers

Frequently Asked Questions About EFIN Security Requirements

What happens if my EFIN is compromised and used for fraudulent filings?

If your EFIN is compromised, the IRS will immediately suspend or revoke it to prevent further fraudulent use. You must report the compromise to the IRS e-help desk (866-255-0654) by the end of the next business day after discovery. The IRS will investigate the incident, and you’ll need to demonstrate that security vulnerabilities have been remediated before a new EFIN can be issued. This process can take weeks or months, during which you cannot e-file returns. You may also face IRS sanctions if the investigation reveals negligent security practices. Clients whose information was accessed must be notified according to state breach notification laws, and you may face civil liability for inadequate data protection.

How often must I review my EFIN usage reports from the IRS?

The IRS recommends reviewing EFIN usage reports weekly at minimum. These reports are updated every seven days in the IRS e-Services EFIN Status page. During peak filing season (January through April), best practice is daily review to detect unauthorized use quickly. Weekly reports show the number of returns transmitted, return types, and acknowledgment counts. You should compare these figures against your internal filing records to identify discrepancies that may indicate compromise. Immediate investigation is required if you find filings you didn’t submit, unexpected volume spikes, or returns filed when your office was closed.

Can I transfer my EFIN if I sell my tax preparation business?

No, EFINs are not transferable under any circumstances according to IRS policy. When a tax preparation business is sold, the buyer must apply for a new EFIN, which can take 4-6 weeks or up to 45 days during peak periods. This non-transferability applies even if the business name and location remain unchanged. The new owner must complete the full IRS e-file application, including designation of principals and responsible officials, suitability checks, and fingerprinting if required. This is a critical consideration in practice sale negotiations, as the buyer will be unable to e-file until the new EFIN is approved. The seller’s EFIN should be deactivated after the sale closes.

What are the fingerprinting requirements for obtaining an EFIN?

IRS fingerprinting requirements depend on professional credentials. Attorneys, Certified Public Accountants (CPAs), and Enrolled Agents (EAs) with current, valid credentials are generally exempt from fingerprinting. All other applicants must complete Livescan electronic fingerprinting at authorized locations. The IRS partners with a fingerprinting vendor that maintains locations in all 50 states, D.C., and U.S. territories. Applicants schedule appointments online, and results are transmitted electronically to the IRS for the criminal background check portion of the suitability review. Fingerprinting fees are paid directly to the vendor and are not refundable. Results typically process within 1-2 weeks, though delays can occur during peak application periods.

Do I need a separate EFIN for each office location?

Yes, the IRS requires a separate EFIN application for each physical location where electronic filing transmissions occur. This requirement ensures proper security controls at each site and enables the IRS to track filing activity by location. Each location’s application must designate a principal, responsible official, and primary contact, though the same individual can serve in these roles for multiple locations if appropriate. If your firm has a central office that handles all electronic transmissions while other locations only prepare returns, you may only need one EFIN at the transmission location. However, if multiple offices independently transmit returns to the IRS, each requires its own EFIN.

What’s the difference between an EFIN and a PTIN?

An EFIN (Electronic Filing Identification Number) and PTIN (Preparer Tax Identification Number) serve different purposes. A PTIN is required for any individual who prepares or assists in preparing federal tax returns for compensation. Each preparer obtains their own PTIN from the IRS, which must be included on all returns they prepare. An EFIN, by contrast, belongs to the firm or business entity and authorizes that entity to electronically transmit returns to the IRS. A tax preparer needs a PTIN regardless of whether they work for a firm with an EFIN. Sole proprietors need both: a PTIN for themselves as an individual preparer and an EFIN for their business to enable e-filing capability.

How do I update my EFIN application information with the IRS?

You must update your EFIN application within 30 days of any changes to business structure, ownership, principals, responsible officials, address, or contact information. Updates are submitted through IRS e-Services using your Secure Access credentials. Log in to e-Services, navigate to the e-file Application page, and select the option to update existing application information. Changes to principals or ownership may require additional suitability checks and fingerprinting for new individuals. Failure to maintain current information can result in EFIN suspension or revocation. The IRS may also suspend EFINs if they cannot contact the responsible official due to outdated contact information, so keeping phone numbers and email addresses current is critical.

What multi-factor authentication methods does the IRS accept for e-Services?

The IRS Secure Access system, used for e-Services including EFIN management, supports multiple MFA methods. Approved methods include authenticator apps (such as Google Authenticator, Microsoft Authenticator, or other TOTP-compliant apps), SMS text message codes sent to registered mobile phones, and phone calls with verification codes. The IRS recommends app-based authenticators as the most secure option, as SMS-based codes are vulnerable to SIM-swapping attacks. When you enable MFA, you’ll receive backup codes that should be stored securely in case your primary authentication method is unavailable. MFA must be configured for all individuals with access to your firm’s e-Services account, and sessions timeout after periods of inactivity requiring re-authentication.

Comprehensive EFIN Security Implementation Checklist

Use this comprehensive checklist to ensure full compliance with EFIN security requirements:

Initial EFIN Application Security

Daily Security Operations

• ☐ Verify all workstations with EFIN access are locked when unattended
• ☐ Review system logs for unusual access attempts or authentication failures
• ☐ Scan email for phishing attempts targeting EFIN or IRS credentials
• ☐ Ensure all tax software updates are verified as legitimate before installation
• ☐ Check that all endpoint security software is active and updated
• ☐ Monitor staff compliance with clean desk policies for EFIN documentation

Weekly Security Tasks

• ☐ Review IRS EFIN Status reports for filing volumes, return types, and acknowledgments
• ☐ Compare IRS acknowledgment counts against internal filing records
• ☐ Investigate any discrepancies, unusual patterns, or unexpected filings
• ☐ Verify all security software patches and updates are applied
• ☐ Review access logs for systems storing or transmitting EFIN credentials
• ☐ Conduct brief security awareness reminder during staff meetings

Monthly Security Tasks

• ☐ Run simulated phishing tests targeting staff with EFIN access
• ☐ Review and update access control lists, removing unnecessary EFIN access
• ☐ Audit third-party vendor connections and service provider access
• ☐ Test backup restoration procedures for systems containing EFIN data
• ☐ Review and update password policies, forcing rotation for high-privilege accounts
• ☐ Test incident response procedures with tabletop exercises
• ☐ Review firewall rules and network segmentation effectiveness

Quarterly Security Tasks

• ☐ Conduct comprehensive security policy review with management
• ☐ Review and update Written Information Security Plan (WISP)
• ☐ Assess third-party vendor security posture and review SOC 2 reports
• ☐ Review cyber insurance coverage and update as needed
• ☐ Conduct comprehensive access review for all EFIN-related systems
• ☐ Test disaster recovery and business continuity procedures

Annual Security Tasks

• ☐ Conduct comprehensive security assessment or audit
• ☐ Engage third-party penetration testing of tax preparation systems
• ☐ Review and update all security policies and procedures
• ☐ Verify EFIN application information is current with the IRS
• ☐ Conduct comprehensive staff security training covering EFIN protection
• ☐ Review and renew cyber liability insurance coverage
• ☐ Assess security technology stack and budget for upgrades
• ☐ Review incident response plan and update based on lessons learned

Professional Resources for EFIN Security

Official IRS Resources

• IRS: How to Maintain, Monitor and Protect Your EFIN – Official guidance on EFIN management and security best practices
• IRS: FAQs About Electronic Filing Identification Numbers – Answers to common EFIN questions including application, usage, and compromise procedures
• IRS Publication 4557: Safeguarding Taxpayer Data – Comprehensive security requirements for all tax return preparers
• IRS Publication 1345: IRS e-file Security and Privacy Standards – Detailed security standards for authorized e-file providers
• IRS Publication 3112: IRS e-file Application and Participation – Step-by-step guidance for EFIN application and provider responsibilities
• IRS e-help Desk: 866-255-0654 (6:30 AM – 6:00 PM Central) – Direct support for EFIN issues and compromise reporting

Federal Cybersecurity Guidance

• NIST Cybersecurity Framework – Comprehensive framework for managing cybersecurity risk
• CISA Cybersecurity Best Practices – Federal guidance on implementing effective security controls
• FTC Cybersecurity for Small Businesses – Practical security guidance for smaller firms

Bellator Cyber Resources for Tax Professionals

• 2025 Cybersecurity Compliance Guide for Tax Professionals – Complete overview of federal security requirements
• FTC Safeguards Rule Compliance for Tax Preparers – Detailed implementation guidance for FTC requirements
• Advanced Phishing Defense for Tax Professionals – Strategies to defend against credential theft attacks
• IRS Data Security Standards Implementation – Technical guidance for IRS Publication 4557 compliance
• Tax Software Security Features Evaluation – How to assess and select secure tax preparation software
• Cybersecurity Training Programs for Tax Professionals – Staff training solutions for security awareness

Conclusion: EFIN Security as Business Continuity Imperative

Implementing comprehensive EFIN security requirements is not merely a regulatory checkbox—it’s a fundamental business continuity imperative that determines whether your tax practice survives in 2025’s threat landscape. The six-digit EFIN that enables your e-filing capability represents both your authorization to practice and a high-value target for sophisticated cybercriminals. A single compromise can result in permanent revocation, devastating financial losses, irreparable reputational damage, and potential criminal liability.

The security measures outlined in this guide—multi-factor authentication, encrypted credential storage, network segmentation, weekly monitoring, comprehensive staff training, and documented incident response procedures—represent the minimum baseline for protecting your EFIN. These controls align with IRS Publication 4557, Publication 1345, the FTC Safeguards Rule, and broader federal cybersecurity frameworks that govern tax preparation businesses.

The cost of implementing proper EFIN security pales in comparison to the cost of compromise. According to IBM’s research, financial services data breaches average $6.08 million in total costs, and compromised EFINs frequently result in complete business shutdowns due to permanent IRS sanctions. Tax professionals who view security as an investment rather than an expense position their practices for sustainable growth and long-term success.

Begin implementing these EFIN security requirements today. Review your current controls against the checklists provided, identify gaps, and develop a remediation plan with defined timelines and accountability. If your practice lacks internal security expertise, consider engaging managed security service providers who specialize in tax preparation businesses and understand the unique compliance requirements you face.

Your EFIN security posture directly impacts your ability to serve clients, maintain IRS authorization, and operate your business. Take action now to ensure your practice remains secure, compliant, and successful throughout 2025 and beyond.