Tips for Safeguarding Tax Records

As this year’s hurricane season starts, the IRS is reminding individuals and businesses to safeguard their records against natural disasters.

Taxpayers should keep a set of backup records in a safe place and away from the original set, the service recommends. Keeping a backup set of records – including such documents as bank statements, returns and insurance policies – is easier now that many financial institutions provide statements electronically and much financial information is available on the Internet. Original records on paper should be scanned into an electronic format.

Among other tips:

  • Taxpayers can save e-documents to the cloud, download them to such backup storage devices as an external hard drive or USB flash drive, or burn them to a CD or DVD.
  • Taxpayers can also photograph or videotape the contents of their home, especially items of higher value. The IRS disaster-loss workbook (http://www.irs.gov/uac/Publication-584,-Casualty,-Disaster,-and-Theft-Loss-Workbook-(Personal-Use-Property)) can help taxpayers compile a room-by-room list of belongings. Photos should be stored with a friend or family member who lives outside the area.
  • Emergency plans should also be reviewed annually. 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.
  • Employers who use payroll service providers should ask if the provider has a fiduciary bond in place to protect the employer in the event of default by the payroll service provider.

More information is available from the IRS at (866) 562-5227. Back copies of previously-filed returns and attachments can be requested by filing Form 4506, “Request for Copy of Tax Return.”

Transcripts showing most line items on returns can be ordered online, at (800) 908-9946 or by using Form 4506T-EZ, “Short Form Request for Individual Tax Return Transcript”  or Form 4506-T, “Request for Transcript of Tax Return.”

The IRS also maintains an ongoing list of disaster areas granted tax relief.

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