When a natural disaster strikes, dealing with the aftermath can be overwhelming. Not only issues related to physical property damage, but also when important financial and tax records have been damaged or destroyed. Whether you’ve experienced a flood, fire, tornado or other disaster, losing receipts, property records and other documentation can make filing taxes or claiming a loss seem even more complicated.
Fortunately, taxpayers have options for reconstructing records and obtaining replacement documents. Having these records is important for tax purposes, federal assistance or insurance reimbursement. The IRS suggests taking these steps if your business was affected by a disaster.
Replace tax records. You can access your tax records or transcripts for many different reasons. It could be needed for filing a tax return, applying for a mortgage or loan, or to file insurance claims in the case of a natural disaster. The IRS explains the different types of tax transcripts and how to get them. The most common type needed after a disaster loss is a tax return transcript. Taxpayers can:
- Register to use Individual Online Account to view, print, or download their transcript(s)
- Order a transcript by mail or call the automated phone transcript service at 800-908-9946. This typically takes between 5 to 10 calendar days for delivery.
- Request by submitting Form 4506-T, Request for Transcript of Tax Return.
Obtain financial and bank records. You may need to gather records related to expenses and revenue incurred in the last several years of your business. Credit card companies and banks generally provide users with access to past statements. You can download those documents and save them to a cloud (e.g., Google Docs) if a disaster destroyed your computers.
Reconstruct personal property records. Photos, videos, canceled checks, receipts can help establish the value of damaged or lost property. You may also consider checking online sources to help determine fair market value for your damaged property.
Obtain real property records. Here are a few ways to obtain copies of your property records that may have been damaged during a disaster. If you do not have any records, you can check the county assessor’s office for old records that might address the value of the property.
- Property documents: Contact the title or escrow company or bank that handled the purchase of the home or other property for copies of the records.
- Home improvements: Get in touch with the contractors who did the work and ask for statements to verify the work and cost. They can also get written descriptions from friends and relatives who saw the house before and after any improvements.
- Inherited property: Check court records for probate values. If a trust or estate existed, taxpayers can contact the attorney who handled the trust.
Gather vehicle records. Vehicle owners can research the current fair-market value for most vehicles. Resources are available online and at most libraries. You can also contact the dealer where the car was purchased and ask for a copy of the contract.
Dealing with the aftermath of a natural disaster can be overwhelming, especially when there’s been damage to property and essential financial and tax documents. If you are dealing with the IRS in the aftermath of a disaster, I suggest working with an experienced tax attorney who can advocate on your behalf. Business owners have enough stress in these types of situations. Let a tax professional help you when it comes to working with the IRS.
Allison Soares is a partner and tax attorney at Vanst Law LLP. It doesn’t matter the issue: audits, collections, appeals, international disclosures, grumpy people— Allison enjoys fixing problems. In addition to her legal work, she has worked in accounting and utilizes that knowledge to her advantage while handling cases involving EDD audits from San Francisco to San Diego.
