Hurricane Ida was a hard reminder that natural disasters can strike anyone, no matter where they live. We all need to be prepared. This includes an emergency supply kit, preplanned evacuation routes and meetup locations, and keeping your insurance up to date. But it also includes making sure you’ve backed up your important documents. Access to financial, insurance, medical and other records can give you a quicker start to the recovery process. The IRS recommends taking the following steps now to protect your financial safety in a disaster situation.
- Review Emergency Plans Yearly – Personal and business situations are constantly evolving, and disasters can happen at a moment’s notice. Set aside time at least once a year to review your emergency plans and update them where needed
- Save or Create Electronic Copies of Documents – This includes bank statements, tax returns, and insurance policies. Most financial institutions provide documents electronically. Check how long those documents are available online. Your tax returns are uploaded to the Bottom Line’s secure portal after we complete them, but for security reasons, they’re automatically deleted after six months. Download documents as soon as they’re available and save them to a USB flash drive, CD or the cloud.
- Document Valuables – Taking pictures or videoing valuables before a disaster strikes makes it easier to claim insurance and tax benefits. IRS.gov has a disaster loss workbook that can help taxpayers compile a room-by-room list of belongings. https://www.irs.gov/forms-pubs/about-publication-584
- Familiarize Yourself with the Tax Relief that’s Available in Disaster Situations – Information on disaster assistance and emergency relief for individuals and businesses is available on the IRS website at https://www.irs.gov/businesses/small-businesses-self-employed/disaster-assistance-and-emergency-relief-for-individuals-and-businesses
Taxpayers who live in a federally declared disaster, can visit https://www.irs.gov/newsroom/around-the-nation and click on their state to see the available disaster tax relief.
There’s no way to make the aftermath of a natural disaster easy or stress free, but some preparation now will help later when it’s time to start the recovery process and navigate through the bureaucracy.
If you would like help preparing your documents in case of a natural disaster, contact the Bottom Line (theBottomLineInc.email@example.com) to schedule a consultation