Federal disaster relief can provide a variety of services and assistance to those affected by natural disasters.
Under the umbrella of the Individuals and Households (IHP) Program, federal disaster relief is used to reimburse eligible applicants for certain types of expenses and losses incurred during a declared disaster.
Eligible applicants for disaster assistance may be reimbursed for up to $34,900 per household (an amount that is indexed with inflation), with the exact amount depending on what was damaged or lost. Examples of what can be covered include:
- Temporary housing costs, such as rent, hotel bills, and the cost of a temporary rental unit.
- Home repairs (including debris removal) which are necessary to make the house habitable again.
- Replacement of essential household items that were destroyed or damaged due to the disaster, such as furniture, appliances, clothing and other personal items.
- Medical expenses incurred during the disaster or due to the disaster, such as prescriptions and doctor visit copays.
- Funeral expenses related to the disaster.
- Other needs arising from the disaster, including childcare costs and transportation expenses.
In addition to the IHP Program, there are other programs available through federal relief efforts that may provide assistance depending on what was affected. For instance, disaster relief may be used to help businesses and farmers rebuild as well as pay for cleanup costs associated with a natural disaster. Additionally, certain homeowners or renters may qualify for grants from the U.S. Small Business Administration (SBA) to cover some of their losses that were not covered by insurance or other programs.
Business Disaster Loans
Economic Injury Disaster Loans (EIDL) offered through the Small Business Administration are intended to help businesses cover their losses from a declared disaster. These loans may be used to pay for fixed expenses, make up for lost revenue, and more. The exact amount of the loan ranges up to $2 million and depends on what was damaged or lost as well as what type of business it is (e.g. a small business versus a larger corporation).
The following types of business qualify under this program:
- Agriculture businesses (including farmers, ranchers, and agricultural cooperatives)
- Small business concerns that employ fewer than 500 people
- Most private non-profit organizations
- Tribal small business concerns
In all cases, funds can be used for pandemic relief, as COVID-19 meets the federal definition of a “disaster” in all 50 states.
The USDA has a program to provide relief for farmers and ranchers who have suffered losses due to a declared disaster. This agricultural assistance may be used to help cover the cost of replacing damaged or destroyed property, replacement of livestock, trees, plants, and other crops that were lost in the disaster. Additionally, the program can help pay for farming operations that were interrupted due to the disaster.
Business and Industry Loans
The Business & Industry (B&I) Guaranteed Loan Program provides federal disaster relief to small businesses and certain non-profit organizations for a variety of purposes related to recovery from a declared disaster. These loans may be used for the construction, purchase, or renovation of property as well as the refinancing of debt incurred due to the disaster. The program mainly is intended for rural businesses and organizations that cannot find financing from other sources. Individuals, federally recognized tribal entities, and non-profits are also eligible.
Disaster Unemployment Assistance
The Disaster Unemployment Assistance (DUA) program provides federal disaster relief to individuals who are not otherwise eligible for unemployment insurance benefits and whose job was lost or suspended in a presidentially declared disaster zone.
To be eligible, applicants must have been living or working in the affected area at the time of the disaster and have worked or had a job what was lost, suspended, or interrupted due to the disaster.
The program provides up to 26 weeks of unemployment benefits and can even cover self-employed individuals who are not typically eligible for regular Unemployment Insurance benefits.
This program is available in all states and territories, although benefits vary from state to state. The assistance provided by the DUA program may include payments for lost wages, job search expenses, relocation expenses, and more. Additionally, certain individuals may be eligible for.
Disaster Assistance and ERP for Individuals and Businesses
Administered by the IRS, the Emergency Relief Program extends filing deadlines and provides tax relief to individuals and businesses affected by a declared disaster. The program allows for payment deferrals, amended returns, and the ability to file late without penalty. It also includes special rules for filing insurance claims or casualty losses related to the disaster that may qualify for a federal disaster tax return depending on the situation.
FSA Farm Ownership Loans
The Farm Service Agency’s Farm Ownership Loan program provides financial assistance to farmers and ranchers who have suffered a significant loss due to a natural disaster. These loans are available in cases where the damage or destruction to property was caused by hail, floods, tornadoes, hurricanes, or other natural disasters. Funds may be used to restore or replace buildings, machinery, and equipment that were lost due to the disaster.
Ultimately, what is covered by federal disaster relief will vary depending on the type of disaster and what was damaged or lost. It is important to check with local authorities to find out what assistance may be available in the event of a natural disaster.
Federal Disaster Aid Coverage
Federal disaster aid includes financial help for short-term needs, such as home repair or temporary housing; long-term recovery efforts, such as rebuilding destroyed homes and businesses; and support for mental health counselling and other trauma services.
It may also cover expenses related to medical and dental care, as well as funeral costs. In addition to financial assistance, the federal government may provide additional services such as debris removal and hazard mitigation.
The goal of federal disaster relief is to help those affected by natural disasters get back on their feet quickly and recover from the event with minimal disruption to their lives. As such, it can be an invaluable tool for those who have been affected by the destruction wrought by natural disasters.
Will disaster relief cover my situation?
Federal disaster relief funds have already been allocated to help individuals, families and businesses such as yours. Call American Financial Tax today to find out how you can access those funds and what kind of assistance you may be eligible for. We are here to help you find the best solution and make sure your financial needs are met after a disaster strikes.
We have the experience and knowledge necessary to navigate the complexities of federal disaster relief programs, so don’t hesitate to contact us with any questions or concerns you may have. We can help you get the assistance and coverage you need to recover from a disaster quickly and effectively. We are here for you in your time of need.
American Financial Tax is committed to providing comprehensive, personalized financial advice and services to individuals, families and businesses recovering from natural disasters. Contact us today to learn more about what kind of federal disaster relief assistance is available to you. We are here to help you get the assistance and coverage you need to move forward quickly and confidently.