In a recent notice the IRS is reminding all of us to undertake planning to protect important documents in the event of a natural disaster. This is National Wildfire Awareness Month, and we are in the midst of National Hurricane Preparedness Week (May 5 to 11). It is important to take the time to develop and implement plans to protect important business, tax, and personal financial information as you consider emergency planning and disaster preparedness.
The IRS notes that the Federal Emergency Management Agency (FEMA) has “already issued 25 major disaster declarations in 15 states impacted by winter storms, flooding, tornadoes, wildfires, landslides and mudslides.” We are just entering the time of year when communities here in California and across the country face the greatest risk of weather-related storm damage and wildfire risk. Many in California are convinced a major earthquake isn’t a matter of “if,” it is a matter of “time.”
We all need to be prepared.
In it’s recent publication IR-2024-129 the IRS provides encourages taxpayers to visit ready.gov, the IRS’ own “Preparing for a Disaster (Taxpayers and Businesses)”, and FEMA.gov for up-to-date information on natural disaster preparations and information.
Planning to protect important documents and possessions in the event of a disaster is an important consideration for each of us to attend to. The citizens of San Diego are unfortunately more than familiar with the risks of wildfire. Our communities have suffered many losses over the past years, and it is important to be prepared to evacuate one’s home in a matter of moments.
It is often a substantial challenge (if not impossible) to reproduce or recreate important business, tax, and personal financial records in the aftermath of any disaster. These documents can be crucial when working to establish the valuation of losses for insurance and tax purposes. Any documents such as recent tax returns, marriage records, social security cards, birth certificates, information about real property, titles, mortgage documents and business records should be organized in a fireproof container that is easily portable in the event of an emergency.
USB drives are able to hold substantial amounts of information and are an excellent strategy for backing up documents, records, business-related information and even important photographs. Our cell phones are able to capture detailed images and videos of personal property to support any resulting insurance or tax reduction claim. You may need to claim federal funds or assistance. The ability to accurately establish the existence of and valuation of losses associated with a natural disaster improves the ability to qualify for the maximum amount of available grants, relief, or even future loans.
The IRS has postponed many tax filing deadlines for US taxpayers in response to the challenges of natural disasters and emergencies. We are entering a season where the likelihood of additional challenges greatly increases. This is why it is important to set aside time for planning to protect important documents in the event of a natural disaster.
