TaxAlerts Tax Article
November 2016 | Written by: Anthony Webber
With the October 17 extended deadline for filing 2015 taxes just behind us, many taxpayers are finally breathing a sigh of relief that their yearly tax filing ordeal is over. Unfortunately for many Americans, this deadline coincided with the disastrous Hurricane Matthew storm, which forced millions of people to drop everything and evacuate their homes. Unless you are an incredibly dedicated taxpayer, taxes are probably the last thing on your mind during an emergency like Matthew.
Fortunately, IRS has increased the extended filing deadline to March 15, 2017, for many of those affected by the storm (though all tax payments related to 2015 tax returns do still need to have been paid by the original April 18, 2016 filing date). For up-to-date information, and to see if you qualify for disaster situation tax relief, please call the IRS Disaster Hotline at 866-562-5227, or visit IRS.gov.
Even if you braved the storm and still managed to get your tax returns filed on time, you might not be out of the woods quite yet. Almost like a twister, an IRS audit notice can seemingly pop up out of thin air with potentially disastrous results. And similar to a natural disaster, proper preparation can be the key to making sure you come out of the situation unscathed.
The single most important thing you can do to make sure you’re prepared for an audit is ensure that you not only keep good, organized records, but also keep those records in a secure place where they can’t be damaged or lost. During an audit, the last thing that any IRS examiner wants to hear is “I lost those documents when my basement flooded!”
While it’s important to keep physical copies for the required time periods, physical records can potentially take up a lot of space and make it more difficult to quickly access or move the files when needed. Creating digital copies of documents and storing them in the cloud or on a flash drive takes up very little space and allows you to instantly access your files. A flash drive can also easily be stored in a fire-resistant, waterproof safe or safe deposit box for additional security. And since the ink on receipts fades over time, electronic copies will ensure that they are still legible years later. As an added bonus, electronic documents will have you prepared in the event that you are audited or need to provide those documents to another institution!
Being able to quickly provide organized documentation can make all the difference in facilitating the best outcome for an audit. For more information regarding disaster relief or audit preparation, please visit your local IRS office or check out IRS.gov.