Before Disaster Strikes: Protecting Tax Records and the Push for Codified Relief

Summary

On September 3, 2026, the IRS issued IR-2026-104, urging taxpayers to protect important tax and financial records before a disaster occurs. Past returns, records of property cost and improvements, insurance policies, and identification documents are the practical building blocks of any later claim for relief or insurance recovery — and they are far easier to assemble before an emergency than after one. In a related development, the Journal of Accountancy reported on August 24, 2026, that the AICPA supports a disaster tax relief bill awaiting the president's signature. The bill would move scattered disaster-relief rules into the Internal Revenue Code, making them easier to find and more predictable, and the AICPA is pressing for the arrangement to be made permanent rather than renewed piecemeal after each disaster.

The same logic applies with extra force to cross-border taxpayers. Canadians who own US property or hold US assets, and US citizens living in Canada, depend on the same records — and face an added layer of difficulty when documents must be reissued across two countries' systems, matched to an ITIN or social security number, and coordinated with visa and residency paperwork. For them, record preservation is not a nicety; it is the cheapest insurance available.

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Our Take

Disaster tax relief is won or lost before the disaster. For cross-border owners of US real estate, we recommend treating records as part of the emergency kit: proof of acquisition cost and capital improvements (which drive both casualty loss calculations and future basis), copies of US returns, insurance and valuation documents, and identity and tax credentials. If the pending bill becomes law, relief rules would for the first time be codified in one coherent place, improving predictability — but complete records remain the practical precondition for any relief to work. Because cross-border document replacement is slow and complex, keep duplicate copies in a secure off-site location, and speak with a CPA familiar with Canada-US tax matters about which of your US assets and records warrant particular attention.

Disclaimer: This article is general information only and does not constitute tax advice; it should not substitute professional tax counsel. Please consult a licensed CPA for advice specific to your situation.