Disaster Assistance Self-Study – Record Reconstruction
Record Reconstruction – Vehicle
- Kelly’s Blue Book is available at most libraries and on-line. It is a good source for the current fair market value of most vehicles on the road.
- Call the dealer and ask for a copy of the contract. If not available, give the dealer all the facts and details, and ask for a comparable price figure.
- Use newspaper ads for the period in which the vehicle was purchased to determine basis, and ads for the period it was destroyed for fair market value.
Record Reconstruction – Business
- Inventory: Get copies of invoices from suppliers. Whenever possible, the invoices should date back at least one year.
- Income: Get copies of bank statements. The deposits should closely reflect what the sales were for any given period.
- Payroll records: If the business uses a service, get copies of records. If not, request copies of back forms from federal and state agencies. To reconstruct current quarter, get copies of checks from the bank. Also ask employees for copies of their pay stubs.
- Last year’s tax returns: Including sales tax reports, business licenses (which normally reflect gross sales for a given period), and payroll returns. Also request any quarters for the current year that are past. The previous returns will have a depreciation list to reconstruct assets.
- Furniture and fixtures: Sketch the inside and outside of the business location. Then start to fill in the details of the sketches.
- Inside: Where was the equipment located? What fixtures and furniture were in the store or office? Where was the inventory located – bookcases? files?
- Outside: Shrubs, landscaping, parking, signs, awnings?
- If you purchased an existing business, go back to the broker for a copy of the purchase agreement. Check with the previous owner for a copy. This should detail what you acquired.
- If the building was constructed for you – go back to the contractor for building plans.
- Check with the county or city planning commission for copies of plans.
Record Reconstruction – Real Property
Take photographs of real property as quickly as possible after the casualty to establish the amount of damage.
- The best evidence is the escrow papers. Begin by calling the title company and the bank that handled the transaction.
- If the necessary records are destroyed, use “comps” for the neighborhood. A licensed appraiser can establish the value with comps. Comps are comparable sales in the same neighborhood. (The appraisal fees are deductible on Schedule A subject to the 2% floor.)
- Find a library of old Multiple Listing books. This is another source of comps to establish basis or fair market value.
- Insurance policies list the value of the building to establish a base figure for replace value insurance. Check with the agent to find out what other records are on file with the policy.
- Improvements may be proven by calling the contractors involved and asking for old records. You might also ask for statements from the contractors verifying their work and cost.
- Get written statements from friends and relatives who saw the home before and after any renovations. Ask if they have any photos of the house taken at family gatherings.
- If a home improvement loan was taken out, get the paperwork from the bank that issued it. The amount of the loan may help establish the cost of the improvements.
- If no other records are available, check at the county assessors office for old records about the property. Look for assessed value and ask for the percentage of assessment to value at the time of purchase. This is a rough guess, but better than no records at all.
- Check court records for probate of inherited property. If a trust or estate existed, contact the attorney who handled it.
Record Reconstruction – Personal
This is a difficult area to reconstruct due to the number of items that may have existed.
- Old department store catalogs can be useful for identifying items that were lost or destroyed in the disaster, especially small kitchen gadgets you may have forgotten about.
- Thrift stores, local newspaper want-ads can establish fair market value of items. Keep these copies with your tax files.
- Go to a used book store. With a tape, measure several rows of used books and count the number of books per shelf. Add up the prices of those books and determine an average cost per shelf.