Today TaxMama hears from Dallas in, where else – Texas, who relates, “When I have problems, I have big ones. The other day it rained 6” and it flooded my shop. And of course I had all of last year’s invoices and receipts in a box on the floor. Over half of them are unreadable. What do I do now if I ever get audited for last year?”
Dear Dallas, Oh my. You do have a situation. Much like that facing the hurricane victims last year. OK, before you do anything else – take photographs to document the mess.
Now, to your records. If you start working on it now, you’ll be able to reconstruct everything you need while the information is still current.
Contact your bank and let them know what happened. Often, after such a disaster, they will get you copies of your bank statements and checks for little or no cost. (If you wait until you get audited, I believe most banks WILL do it for no-charge, but you’ll be strapped for time.)
If you have credit cards, contact them for summaries of your activities. Or go online to see if you can get the records, there.
No doubt you work with many vendors and customers on a regular basis? Ask them to see, when they have time, if they can give you copies of the invoices for your s purchases.
Mortgage or loan companies can easily provide new statements. In fact, you can probably get them online.
If there’s anything else I’ve overlooked…your appointment book or mileage log? Reconstruct that and include a notation that you are doing it due to the flood.
(Wouldn’t hurt to include a copy of a newspaper clipping about the flood for your files.)
Oh yes, one last thing – don’t keep your records on the floor anymore. Build some cabinets in that barn that are off the floor and won’t get soaked if the roof leaks.
Remember, you’ll find answers to questions about reconstructing records and all kinds of tax issues, free. Where? Where else? At TaxMama.com[Note: If you were subscribed to the e-mailed TaxQuips, you’d get special tips that aren’t published anywhere else. Please click on the subscribe link and join us.]
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