If a catastrophic event damages or disrupts your business, lost or destroyed tax records can add to your stress. The IRS suggests some steps you can take to deal with them if a disaster strikes.
- Recreate your lost inventory by asking for invoices from suppliers going back at least one year.
- Request copies of last year’s federal, state and local income tax returns. Also ask for copies of sales tax reports, payroll tax returns and any business licenses.
- Check for pictures and videos from cell phones, camcorders and cameras of the building, equipment and inventory.
- As a last resort, sketch where inside equipment, inventory and outside assets like signage were located.
You may want to work with an appraiser to get a fair market value of your business before and after the disaster. For more information and help reconstructing your tax records, talk to your tax professional.