It’s Not Too Late to Plan for Storm Season, Other Natural Disasters by Adam Cohen, CPA

Posted on August 24, 2020 by Adam Cohen

Hurricane season is heating up, and we are reminded of the importance of preparing for the impact of a threatening storm or other natural disaster and planning for short and long-term recovery.

One thing that we can rely on every year is that hurricane season will begin on June 1 and run through November 30. This means that you may want to begin stocking up on water, canned foods, batteries and other essential supplies during the spring and early summer months. If you wait until a storm is approaching, you may not get everything you need.

Regardless of where you live, you should already have a plan in place for how you will secure your personal property and protect the lives of your family members and employees in the event of a storm or any other natural disaster. After determining whether you will need to evacuate and where you would go, you should begin to prepare your home and businesses by following these tips.

Secure Important Documents

 Put critical documents, including tax returns, bank statements, birth and marriage certificates, titles and deeds providing property ownership, and insurance policies, into waterproof containers. You may also want to include a list of emergency contacts, including family members, contractors you can rely on to repair damages and, of course, your insurance agent.

Make hard copies for a friend or family member to store out of state and create electronic copies to store on your computer, external hard drive and in the cloud to retrieve quickly after the storm passes.

If you own a business, you should also secure records of inventory, sales orders and equipment leases as well as your historic and projected financial data, including balance sheets, profit and loss statements and budgets. Moreover, take steps to duplicate, back-up and electronically store all documents and systems that are vital to the daily operation of your business. There are several platforms, including Carbonite, that you can do this for you automatically on a daily basis.

Know Where to Go to Reconstruct Records

In the event you lose important documents in a disaster, you will need to know how to reconstruct those records to prove disaster-related losses for tax or insurance purposes or to receive federal disaster assistance. For example, you can usually contact your bank or other financial institution to get copies of statements for your checking, savings and investment accounts. For tax returns, contact your accountant or tax advisor, who may keep copies for you, or you may get copies of your tax transcripts from the IRS by visiting or calling (800) 908-9946.

Review Insurance Policies

You do not want to wait until a storm is threatening to determine if you have appropriate insurance to recover any physical and financial losses you may sustain. Carefully review all your policies and riders, including property insurance, flood and windstorm coverage, and business interruption insurance, to ensure you understand the terms, limitations and exceptions to coverage, and remember that some personal and business assets may require separate policies. If you have questions, call your insurance agent.

While you review your insurance policies, remember that hurricanes and floods are not the only perils that can put your property and businesses in danger. You should also have coverage for other hazards unique to your circumstances, including man-made disasters, such as toxic spills or vandalism, and even a potential global pandemic like COVID-19.

Document your Assets

Record a narrated video of the inside and outside of your home and office, going room-by-room and making note of highly valued possessions, including jewelry, artwork or other collectibles. These recordings and individual photos can help you prove the market value of your possessions to support insurance claims and any potential benefits associated with a disaster-related loss.

Check on Fiduciary Bonds

If you are a business owner who uses a third-party payroll service provider, the IRS recommends you ask the provider if it has a fiduciary bond in place to protect you in the event the provider defaults.

Have a Continuity Plan

 No one wants to imagine a worst-case scenario, but by having a contingency plan in place, you can minimize the impact a storm or other natural disaster will have on your personal life and your business operations. Do you have a place to stay for the long haul? Can you and your employees work from home? If yes, what resources are needed to facilitate a seamless transition?

How quickly you and your business can return to normal in the wake of a disaster depends on the planning you do before disaster strikes. Not only should you have a solid plan in place, but you should also get used to testing and updating that plan on an annual basis, especially as your personal and business circumstances change over time. The more you prepare, the faster and easier it will be for you to recover.

About the Author: Adam Cohen, CPA, is an associate director of Tax Services with Berkowitz Pollack Brant Advisors + CPAs, where he works with closely held businesses and non-profit charities, hospitals and family foundations to maintain tax efficiency and comply with federal and state regulations. He can be reached at the CPA firm’s Ft. Lauderdale, Fla., office at (954) 712-7000 or