Even if they have that amount and more set aside, extreme circumstances might wipe out all cash reserves

Ideally a financial instrument that pays a little bit of interest with security, but you can quickly access, so you can squeeze a little bit more out.

Money market accounts are a pretty easy yet secure option. I'm pretty sure there are better options considering my lack of investing knowledge and loophole manipulation.

Amazon's tax savants could probably give better advice, though they may not be as intricately familiar with tax code applicable to us peasants.

Regardless, having the money needed to pay for last year's taxes sitting in the bank, equivalent to... a year or two of living expenses or so... and not having to empty it out as the world comes crashing down is kind of nice.