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This publish is dependant on our recent ebook “How To Handle Federal Citizen Information In Microsoft Teams.” Click the link to download the entire ebook!

Defining FTI and Effects of Non-Compliance

It isn’t only the Irs (IRS) or federal agencies, every condition government includes a department accountable for taxation or revenue.

By their nature, these agencies handle both your personal data (PII) in addition to federal tax information (FTI).

PII is any sensitive information you can use to recognize a person, for example social security figures, whereas FTI is determined very broadly in Internal Revenue Code 6103 as return information caused by the government or perhaps a secondary source. Including info on an individual’s tax matters even if it’s anonymized and identifiers are stripped out.

Information supplied by the government should be considered FTI, but the very same information acquired inside a different manner might need to be considered PII.

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The sensitivity amounts of PII and FTI require that agencies are very diligent within the protection from the confidentiality of the information.

Note: There are a few kinds of controlled PII and also the strategies provided can be simply modified to deal with rules like the Healthcare Insurance Portability and Protection Act (HIPAA) yet others too.

Actually, Internal Revenue Code 7213 causes it to be a legal offense for federal and condition employees yet others who unlawfully disclose federal tax statements and return information. It’s “punishable upon conviction with a fine in almost any amount not exceeding $5,000, or jail time of only five years.”

Challenges to Compliant Collaboration

Many condition agencies are challenged within their handling of FTI with a couple of important aspects. Many are common communication challenges and risks for sensitive data types that aren’t specific towards the nature of FTI for example:

  • Multiple siloed divisions and agencies
  • Spread office locations over the condition and
  • The necessity to make use of a diverse selection of exterior collaborators including taxpayers, vendors, and contractors.

But possibly the biggest challenge to modernizing collaboration surrounding FTI data would be that the unique limitations and needs put on this data preclude using effective collaboration platforms, for example Microsoft 365 (formerly Office 365), unless of course configured appropriately.

The obstacle to proper configuration frequently rests with how Microsoft 365 is deployed over the condition government. In just about any situation, the whole from the state’s government leverages just one Microsoft 365 tenant for those their agencies.

This really is beneficial because it enables condition governments to buy at scale and enables faster, simpler collaboration while removing data silos. It might be challenging, however, when agencies with specific data limitations, like FTI data, need a different group of configuration settings than other agencies.

While Microsoft 365 is amazingly extensible and versatile, you may still find certain settings, for example the way you provision Groups, such as the following a “one tenant, one rule,” architecture. Consequently, the central condition IT provider is frequently unwilling to put tighter limitations on other agencies to aid one agency’s use situation and also the agency handling the sensitive data have to get alternative method for collaboration.

The irony is the fact that Microsoft 365’s incredibly robust security and compliance features allow it to be the perfect atmosphere for hosting and safeguard these sensitive data types.

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AvePoint Cloud Governance can enable delegated administration.

FTI Rules and Rules

As formerly pointed out, FTI information is controlled by unique rules and rules which are enforced by strong punitive measures for non-compliance.

The guidelines and rules for managing both physical in addition to digital FTI data could be utilized in Publication 1075, “Tax Information Security Guidelines For Federal, Condition, and native Agencies.”

It’s worth noting that it is an in depth document that gives guidelines for an array of modern digital systems—in no area of the document will it limit using FTI data to older legacy systems for example secure email.

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If combing with the 163 pages sounds a little daunting, we’ve summarized what we should see because the best needs for just about any system managing and storing FTI content. The machine must have the ability to:

  • Produce a report of FTI content within the collaboration atmosphere for audits
  • Determine everybody inside a department or agency that has had use of FTI content
  • Leverage file encryption that’s FIPS 140-2 compliant for data resting as well as in motion
  • Manage, monitor and control who can access FTI content, this frequently includes internal employees, contractors removed through the IRS, and exterior taxpayers being able to access their very own FTI content
  • Retain all FTI content and connected activity logs for many years

LEGAL DISCLAIMER:  The data found in this publication is supplied for informational purposes only, and cannot be construed as professional suggestions about any subject material. We specifically disclaim all liability for actions taken or otherwise taken according to any content herein. Information is supplied “as is,” without any guarantee of completeness, precision, timeliness or from the results acquired from using the data.

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Current Common Collaboration Scenarios

Therefore if these limitations are stopping condition agencies from leveraging Microsoft 365 to deal with FTI what internet site? The normal workflow we view is:

  • States access FTI data via a proprietary application, specific towards the IRS
  • Any new content developed with information produced from this application becomes considered FTI content
  • FTI submissions are frequently kept in network drives (or perhaps personal hard disk drives!) and shared through secure email. Although this is a compliant system, the collaboration with internal and exterior users is inefficient. Point about this is because of the constraints of email attachments: co-authoring is illegitimate, large files take time and effort to transmit, versioning creates confusion more than a single truth and there’s no granular permission access.
  • Alternative common collaboration methods include cumbersome secure FTP, pricey to keep proprietary systems, and verbal communications.

Future Condition

New Possible Collaboration Scenarios

Now let’s have a second to assume additional, modern collaboration scenarios that may be enabled by Microsoft 365 and Microsoft Teams for example persistent chat in channels, ad-hoc chat, as well as an underlying enterprise collaboration management system to keep and access files.

What can FTI compliant versions of those scenarios seem like?

Ongoing Group FTI Discussion

Use Situation: Collaboration and real-time chat for any regular number of collaborators around ongoing initiatives and reoccurring tasks.

Tool: A “Confidential” Team in Microsoft Teams

Advantages: Chat, voice, and collaboration could be in context using the relevant documents and particular information stored inside the Team. Membership is fixed to individuals who require access.


  1. A regular monthly “Confidential” Team is requested and provisioned for that working group.
  2. The audience makes use of this “Confidential” Team to go over and share FTI content.
  3. Any documents submitted towards the Team is tagged and considered FTI.
  4. Any conversation within the Team with FTI is going to be tagged with “#FTI.”
  5. In the finish from the month, they is going to be archived and a replacement provisioned.

Non-Sensitive Communication

Use Situation: A company worker which handles FTI information (agency FTI user) must communicate and collaborate regarding non-sensitive information.

Tool: “Non-Sensitive” Team in Microsoft Teams

Advantages: The company FTI user is now talk to other condition employees while using tool they’re using, which removes information silos. Any sensitive details are caught and contained.


  1. Agency FTI user demands a brand new Non-Sensitive Team
  2. If your Team member uploads a document or shares something inside a Team conversation with PII or FTI the machine scans the information and helps to create a burglar incident.

FTI Audit with Taxpayers

Use Situation: The company accountable for handling FTI data needs to talk with an exterior citizen regarding FTI data.

Tool: “Confidential” Internal Audit Team and “Confidential” Exterior Audit Team in Microsoft Teams

Advantages: Chat, voice, and collaboration could be in context using the relevant documents and particular information stored inside the Team. Membership is fixed to individuals who require access, including specific exterior users.


  1. Audit working group demands a brand new “Confidential” Internal and Exterior Audit Teams be provisioned
  2. FTI details are taken in the tax system of records and copied right into a document
  3. Document is submitted in to the Internal Team and tagged/considered FTI
  4. Audit team discusses the audit within the Internal Audit Team conversation using “#FTI”
  5. The citizen is put into the Exterior Audit Team
  6. Audit Team copies appropriate FTI documents in the exterior team and tags as FTI
  7. Document will be submitted towards the Exterior Team and tagged as Exterior Private
  8. Any conversation using the citizen has got the “#FTI” tag
  9. When the audit complete, both Teams are archived

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Enabling Technologies

The main technologies enabling these modern collaboration scenarios have course Microsoft 365 and Microsoft Teams. Microsoft 365 has got the best security and compliance features available associated with a collaboration platform today.

The Safety and Compliance Center enables organizations to with confidence identify, classify, manage, and safeguard all kinds of sensitive content leveraging sensitivity labels.

These functions could be extended and configured distinctively for any specific agency using third-party solutions, which you’ll see in this table mapping FTI needs to technical solutions.

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