Looking for a storm season cash plan that does not feel like a fear campaign? Steven Palmieri, a Tax CFO, looks at storm season in a simple way. Atlantic hurricane season sits between June 1 and November 30, so it works like a window on the calendar. Like the Rodeo in March or a slow August, it can be planned for once you know what it costs.
A storm hits three parts of your cash, and they are easy to lump together. They are not the same problem.
The first is lost sales. If the doors are closed for a week or two, the revenue does not come in, and most of your bills still do. The second is payroll. The people who work for you still need to be paid, and the payroll provider you run will still draw the money when the day comes. The third is the insurance deductible, which is due up front even when a claim is good. Each one can be sized in advance, and each one goes on the cash plan as its own line.
Claims take time. We make no promise about what any insurance company will decide, because that is between you, the adjuster and the insurer. What we can do is assume in the plan that cash leaves first and returns later. If you plan for the repair bill to be paid out of pocket and the check to arrive in a few weeks or months, you will not be surprised by the gap.
This is one reason a reserve matters more than a hope. A line of credit may also help, but banks tend to be more open to a line when your statements look healthy, which is why the quiet weeks are the time to talk. The page on building a cash reserve shows how to size what you hold.
Books kept in the cloud and closed every month make a hard week easier. You can show a lender what the business looked like before the storm. You can show an adjuster the equipment, the inventory and the receipts. You do not have to remember what was in a drawer that is now under water. We keep the books current and the records in one place, and that is the part of a claim we can help with. The claim itself stays with you and your insurer.
When a disaster declaration covers your area, the IRS can postpone some filing and payment dates. The place to check is the IRS page on tax relief in disaster situations, which lists each announcement with its dates. We do not quote a date from memory, because the dates change with each event. We watch that page when a storm hits and tell you what applies to you.
In the quiet months, the one decision this page asks you to make is how much to hold back before June. A first honest number is enough. Look at what a closed week would cost you in lost sales, add the deductible, add a week of payroll, and the total is a place to start. Each season, the National Weather Service in Houston and Galveston publishes a Hurricane Guide. The week it comes out is a good week to look at the reserve and see whether it still matches the business.
Harris County's flood control district puts the pace of a major flood, somewhere in the county, at roughly one every two years. Treat a lost week the way you would treat a slow August. It is a cost, you know roughly when it can come, and you can cover it from money you set aside while the sun was out. Because we are all Texans, none of this feels new to us, and the plan is built around it from the start.
On a free Second Look call, we look at your last twelve months, mark the weeks that would hurt most, and build a first storm season line for your cash plan. There is nothing to sign and nothing to pay. If you want to look at the reserve before the call, cash planning for a year that swings is the page to read.
You will be talking to the Steven Palmieri practice.