How to Recreate Personal and Tax Documents After a Disaster

Reconstructing lost records and filing tax returns may not be at the top of most people’s to-do lists in the wake of a hurricane, a wildfire, or a global pandemic.

Nevertheless, they are critical for a number of reasons, including getting reimbursement for the damage from an insurance company, obtaining federal assistance, and reporting losses on a tax return.

Be Aware of Postponed Federal Tax Deadlines

The Internal Revenue Service (IRS) has delayed tax deadlines for both national and regional disasters over the last couple of years.

Tax Day was delayed nationwide for tax years 2019 and 2020 as Americans struggled to cope with the economic effects of the COVID-19 pandemic. In 2020, Alabama residents got an extension due to the damage wreaked by Hurricane Sally.

In 2021, Louisiana residents and business owners who are required to file quarterly got an extension on their due dates due to the damage caused by Hurricane Ida. Late filers with an extension also got a break. These same extensions were later given to affected residents of Mississippi, New York, and New Jersey.

With the exception of the Hurricane Ida measure, all of the delayed deadlines listed above have passed at this writing.

However, you can keep an eye on the latest at the IRS site at a page called “Tax Relief in Disaster Situations.”

What About the States?

States usually fall in line with federal extensions in the wake of disasters, “especially if the disaster is in that particular state,” says David A. Shuster, principal and director of tax controversy services at the Manhattan-based accounting firm Friedman. However, he warns, “a taxpayer located in a disaster state but [with] a filing obligation in another state might find that such other state has granted no general relief for taxpayers located in the disaster state.”

According to Shuster, most states typically grant relief from penalties relating to a missed deadline if there’s reasonable cause for missing that deadline and a disaster is usually considered a reasonable cause. “Procedurally, some states might require a notation on the delinquent filing, or that an explanation accompany that filing, indicating that its delinquency is attributable to some disaster,” he adds. “In other cases, the taxpayer should just make the delinquent filing and then respond to any penalty notice with a reasonable cause explanation.”

Assembling and Re-Creating Records

More time-consuming and complicated than obtaining an extension on filing taxes is reconstructing records after a disaster.

People who are the victims of a natural disaster need to gather the documentation for real property, personal property, and vehicles that they own. Businesses must create a list of lost inventories.

It’s all necessary for several reasons, including submitting for insurance reimbursement and filing taxes. Most important, records can help people prove their disaster-related losses. Accurately estimating losses can generate greater recovery assistance such as loans or grants.

The primary disasters in question are fires, floods, tornadoes, and hurricanes, due to the severe loss of life and property they can cause, says Timothy P. Speiss, a CPA at accounting firm EisnerAmper and co-chair of Personal Wealth Advisors Practice. “Power outages are becoming more common and severe, as are health emergencies,” he adds.

“Fire is probably the worst because documents could end up being permanently destroyed,” says Shuster. “By contrast, a flood might merely ruin documents, but they might be salvageable to some extent.”

Where to Find the Records

Recent records are generally easier to replace than older ones because the issuers are likely to have their own record-retention policies. Here are some places to go looking.

IRS Get Transcript Service

The Get Transcript Service on the IRS site allows individual taxpayers to retrieve their own transcripts by mail or online. There is no charge.

You can also call the automated phone transcript service of the IRS at 800-908-9946 to order a tax return or tax account transcript to be sent by mail.

Financial Institutions and Involved Parties

People can gather past financial statements from their credit card companies or banks. Some records will be available online. People can contact their banks to get paper copies of these statements.

“For any documents related to property, homeowners can contact the title company, escrow company, or bank that handled the purchase of their home or other property,” says Speiss. “For inherited property, taxpayers can check court records for probate values. If a trust or estate existed, taxpayers can contact the attorney who handled the trust.” When no other records are available, people should check the county assessor’s office for old records that might address the value of the property.

Contractors and Witnesses

Some records are more commonly overlooked, Shuster says, such as “those bearing on home improvements—contractor invoices, contracts, and proofs of payment for such improvements.” If you’ve made home improvements, Speiss recommends getting in touch with the contractors who did the work. “Ask for statements to verify the work and cost,” he said.

Homeowners can also get written descriptions from friends and relatives who saw the house before and after any improvements.

Restoring Real Property Records

Real property, also called real estate, includes land plus anything built on, growing on, or attached to it, says Speiss. “Contact the title company, escrow company, or bank that handled the purchase of the home to get copies of appropriate documents,” he continues. “Real estate brokers may also be able to help.”

Other strategies include:

• Use the current property tax statement for floor area ratios if possible. If they are not available, owners can usually get copies from the county assessor’s office.
• Establish a basis or fair market value of the home by reviewing comparable sales within the same neighborhood. This information can be found by contacting an appraisal company or visiting a website that provides home valuations.
• Check with the mortgage company for copies of appraisals or other information it may have about cost or fair market value in the area.
• Contact insurance companies that issued coverage for the related documents.
• Review insurance policies, as they usually list the value of a building, establishing a base figure for replacement value insurance.

If improvements were made to the home, reach out to the contractors who did the work to see if records are available. “If possible, get statements from the contractors verifying their work and cost,” says Speiss. Get written accounts from friends and relatives who saw the house before and after any improvements. See if any of them have photos taken at get-togethers.

If there is a home improvement loan, get paperwork from the institution that issued the loan. The amount of the loan may help establish the cost of the improvements.

If no other records are available, check the county assessor’s office for old records that might address the value of the property. 

Personal Property

“It can be difficult to reconstruct records showing the fair market value of some types of personal property,” says Speiss, who recommends taking the following steps when cataloguing lost items and their values:

• Look on mobile phones for pictures taken in the home that might show the damaged property in the background before the disaster.
• Check websites that can help establish the cost and fair market value of lost items.
• Support the valuation with photographs, videos, canceled checks, receipts, or other evidence. 
• Contact the credit card company or bank for past statements if items were purchased using a credit or debit card. Credit card companies and banks often provide access to these statements online.

“If there are no photos or videos of the property, a simple method to help remember what items were lost is to sketch pictures of each room that was impacted,” says Speiss. “These do not have to be professionally drawn, just functional.”

• Draw a furniture floor plan for every room showing where each piece was placed. Include drawers, dressers, and shelves.
• Sketch pictures of the room looking toward any shelves or tables and show their contents.
• Sketch less prominent aspects of the home, such as garages, attics, closets, basements, and items hanging on walls.

Vehicles

Several resources can help determine the current fair market value of most cars on the road. These resources are all available online and at most libraries.

• Kelley Blue Book is a vehicle valuation and automotive research company.
• The National Automobile Dealers Association is a trade organization representing franchised new car and truck dealerships.
• Edmunds is an online resource for automotive information.

“Additionally, call the dealer where the car was purchased and ask for a copy of the contract,” says Speiss. “If this is not available, give the dealer all the facts and details and ask for a comparable price figure. If making payments on the car, check with the lien holder.”

The Bottom Line

In the wake of a natural disaster, assembling paperwork and filing taxes are not likely to be among your initial impulses. Nevertheless, in order to recover as completely as possible from the damage, you need to be documenting its extent and cost in order to gain federal and state assistance. There are a variety of ways to reconstruct lost documentation so that all is, indeed, not lost. Take advantage of them to the fullest extent possible.