IRS Encourages Taxpayers to Safeguard Tax, Financial Records In Preparation for
June 1, 2007
As the hurricane season begins today, the Internal Revenue Service encourages taxpayers
to safeguard their records. Some simple steps can help taxpayers and businesses
protect financial and tax records in case of hurricanes and other disasters.
“With forecasts calling for an active Atlantic hurricane season, the IRS encourages
taxpayers to protect tax and financial documents that can be hard to replace,” IRS
Acting Commissioner Kevin M. Brown said. “A little planning can help safeguard valuable
information in case a hurricane or other disaster strikes.”
Listed below are tips for individuals and businesses on maintaining financial and
Many people now receive bank statements and documents by e-mail or over the Web.
Paper records such as W-2s, tax returns and other documents can be scanned into
an electronic format.
With documents in electronic form, taxpayers can copy them onto a USB drive as a
backup, which can be sent to a relative in another city for safe-keeping in case
the taxpayer’s computer and paper files are destroyed.
Other options include copying files onto a CD or DVD. Many retail stores also sell
computer software packages that can be used for recordkeeping.
Another way a taxpayer can prepare for disaster is to photograph or videotape the
contents of his or her home, especially items of greater value. The IRS has a disaster
loss workbook, Publication 584,
which can help taxpayers compile a room-by-room list of belongings.
This can help an individual prove the market value of items for insurance and casualty
loss claims. Photos should be stored with a friend or family member who lives outside
Check on Fiduciary Bonds
Employers who use payroll service providers should ask the provider if they have
a fiduciary bond in place. The bond could protect the employer in the event of default
by the payroll service provider.
Update Emergency Plans
Emergency plans should be reviewed annually. Personal and business situations change
over time as do preparedness needs. Individual taxpayers should make sure they are
saving documents everybody should keep including such things as W-2s, home closing
statements and insurance records. When employers hire new employees or when a company
or organization changes functions, plans should be updated accordingly and employees
should be informed of the changes.