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Friday, November 2, 2018

Important IRS Tips for Anyone Affected by a Disaster

None of us expect to be affected by a natural disaster. But floods, tornadoes, wildfires, and earthquakes have the ability to challenge that mentality in a moment’s notice.

Charity Navigator works closely with the IRS to ensure you have the most up-to-date information to make your charitable giving decisions, particularly in the wake of a disaster. We know that many of our users make donations to the disaster response organizations featured in our Hot Topics because they know what it’s like to be affected by a disaster, or know someone who is being affected by a current disaster.

Knowing this, the IRS has asked us to pass along this important information to our readers. If you, or someone you know, has been affected by a natural disaster please continue to reading. These tips will help you reconstruct your records to prove your losses for tax purposes, getting federal assistance, or insurance reimbursement.

According to the IRS, individuals and families affected by a natural disaster may need to reconstruct their records to prove their losses and qualify for appropriate tax measures, federal assistance, or insurance reimbursement. 

Please take a look at this information, provided by the IRS, that details what information you will need, how to document your losses, and how to collect and retain records about your property.

Tax Return Transcripts

Taxpayers can get free tax return transcripts by using the Get Transcript tool on IRS.gov. They can also call 800-908-9946 to order them by phone.

Proof of loss

  • To establish the extent of the damage, taxpayers should take photographs or videos of affected property as soon as possible after the disaster.
  • Taxpayers can look on their mobile phone for pictures that show the property before the disaster damaged it.
  • If a taxpayer doesn’t have photographs or videos of their property, a simple method to help them remember what items they lost is to sketch pictures of each room that was affected.
  • Taxpayers can support the valuation of property with photographs, videos, canceled checks, receipts, or other evidence.
  • If they bought items using a credit card or debit card, they should gather past statements from their credit card company or bank. If the taxpayer didn’t keep these records or they were destroyed, statements may be available online or they can contact their financial institution.

Records about property

  • Taxpayers can contact the title company, escrow company, or bank that handled the purchase of their home to get copies of appropriate documents.
  • Taxpayers who made improvements to their home should contact the contractors who did the work to see if records are available. If possible, the home owner should get statements from the contractors to verify the work and cost. They can also get written accounts from friends and relatives who saw the house before and after any improvements.
  • For inherited property, taxpayers can check court records for probate values. If a trust or estate existed, the taxpayer can contact the attorney who handled the trust.
  • When no other records are available, taxpayers can check the county assessor’s office for old records that might address the value of the property.
  • There are several resources that can help someone determine the current fair-market value of most cars on the road. These resources are all available online and at most libraries. They include Kelley’s Blue Book, the National Automobile Dealers Association, and Edmunds.

For more information about how to reconstruct your records, please visit: https://go.usa.gov/xPQdn

Please share this with anyone who has been affected by a natural disaster!

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