5 Financial Safety Tips!
The often forgotten piece of disaster preparedness
After a natural disaster, having access to personal financial, insurance, medical and other records can help people starting the recovery process quickly. There are a few things you can do to help protect your financial safety in a disaster situation.
1. Update emergency plans. A disaster can strike at any time. Personal and business situations are constantly evolving; you should review their emergency plans annually.
2. Create electronic copies of documents.
Keep documents in a safe place. This includes bank statements, tax returns, and insurance policies. This is especially easy now since many financial institutions provide statements and documents electronically. If original documents are available only on paper, you can use a scanner and save them on a USB flash drive, CD, or in the cloud.
3. Document valuables. Documenting valuables by taking pictures or videoing them before a disaster strikes makes it easier to claim insurance and tax benefits, if necessary. The IRS has an excellent workbook to help you compile a room-by-room list of belongings, see attached.
4. Understand tax relief is available in disaster situations. Net personal casualty and theft losses are deductible only to the extent they’re attributable to a federally declared disaster. Claims must include the FEMA code assigned to the disaster.
5. States also offer Disaster Relief, not just the U.S.Government.
Taxpayers who live in a federally declared disaster can go to their state to review the available disaster tax relief. Those who live in counties qualifying for disaster relief receive automatic filing and payment extensions for many currently due tax forms and don’t need to contact the agency to get relief. People with disaster-related questions can call the IRS at 866-562-5227 to speak with an IRS specialist trained to handle disaster issues. They can request copies of previously filed tax returns and attachments by filing Form 4506, order transcripts showing most line items through Get Transcript on IRS.gov or call 800-908-9946 for transcripts.