Disasters can strike at any time. There are currently wildfires burning in the west, and Hurricane season has started early in the southeast. Protecting your information to ensure it survives a disaster can make the recovery process easier should you be struck by a disaster.
You should always keep your records in a safe place within your home or business. But, you should also ensure that you keep back up records in a separate location.
Backing up your records, including supporting documentation, is easier now that many financial institutions provide statements and documents electronically. Moreover, much of your other financial information is likely available online. Even if the original records are provided only on paper, you can scan and save them in an electronic format. With documents in electronic form, taxpayers can download them to a backup storage device, like an external hard drive, or burn them to a CD or DVD to keep in a safe deposit box. Furthermore, you can take advantage of an online storage solution for a few dollars a month. Online storage solutions are often some of the safest locations to store backup documentation as they are oftentimes located many miles from your home or business.
Another step a taxpayer can take to prepare for disaster is to photograph or videotape the contents of his or her home, especially items of higher value. The IRS has a disaster loss workbook, Publication 584, which can help taxpayers compile a room-by-room list of belongings.
A photographic record 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 the area, or digital copies can be stored the same way your other electronic backup information is stored.
Your business should ensure it has developed an emergency operations plan in the event of a disaster. Once established, you should review these plans annually as personal and business situations and preparedness needs change over time. If you hire new employees or your company or organization changes functions, plans should be updated accordingly and employees should be informed of the changes.
Please contact our firm for more information about ways to ensure your company is prepared for a disaster.