Share:

If your home or business has been damaged or destroyed in a natural disaster, contacting your trusted accountant is likely the last thing on your mind. While paying your taxes won’t automatically go away despite your situation, the government does provide relief in certain situations. Here are a few helpful tax resources to be aware of if you’ve been affected by a natural disaster. 

Natural Disaster Aftermath: What Tax Resources Can Help You? 

What Can You Deduct? 

Under the Robert T. Stafford Disaster Relief & Emergency Assistance Act, the Federal government can declare “disaster areas,” or areas eligible for federal assistance. Those in this area are eligible to deduct casualty and theft losses relating to their homes, household items, and vehicles on their Federal tax returns.

The government identifies casualty losses as the damages, destruction, or loss of your property from an unusual natural event, such as a flood, earthquake, fire, or tornado. A theft loss is the taking of your money or property with criminal intent, meaning the theft must be illegal in your state. Business or income-producing properties are allowed to claim the number of losses as their adjusted basis on tax filings. For both homeowners and business owners, any amounts covered by insurance are not eligible for deduction.

How Can You Prepare? 

accountantWhile it’s difficult to think about, preparing for a natural disaster will not only ensure your safety but help you in the aftermath. The IRS urges all individuals to create an emergency preparedness plan. They suggest keeping original documents, such as bank statements, tax returns, deeds, titles, and insurance policies in a fire-retardant, waterproof area. Document your valuables by taking photos and getting appraisals of valuable items. In the event you need assistance after a natural disaster, affected taxpayers can speak with an IRS specialist or certified accountant trained to handle disaster relief issues. 

How Can You Reconstruct Your Records if They’re Lost?

If your original documents were damaged in a natural disaster, there are steps you can take to reconstruct your records. For personal real estate records, contact the title company that handled the escrow of your home to see if any documents are available. You can also determine the fair market value of your home by using neighborhood comparables, or the most recent tax assessment. 

Businesses can reconstruct important documents by collecting the most recent invoices from suppliers in order to assess lost inventories. Sales losses can be compiled from the previous year’s tax and banking statements. To determine the value of the building, contact any contractors who built the structure for the original architectural plans. If the business was purchased from another entity, contact the broker to see if they have copies of the real estate purchase transaction and original valuation in their records.  

 

If your home or small business has been affected by a natural disaster, let a qualified accountant handle your taxes. The team at The Callen Accounting Group, PLLC provides professional financial services, including tax management and payroll processing, to small businesses and individuals throughout Mountain Home, AR. Call their team today at (870) 425-6066 or visit their website to find out how they can support you in good times and in bad. 

tracking