Papers: To Keep or Not to Keep, That is the Question!
February 22, 2008 by Julie Bonner
Filed under Home & Living
It’s tax time again! Did I hear some groaning out there?
One question I get asked a lot is “What papers can I keep and what can I throw away?” There are certain papers that are crucial to have at tax time, some that you can eventually get rid of after a certain period of time and some that you can just shred and recycle.
Here’s a great list from the experts at The Container Store that will help you get started in dealing with all that paper. For more information, speak with a financial expert.
Documents to Keep Permanently
- Annual tax returns
- Year-end summaries from financial service companies
- Stock and bond certificates
- Deeds of property and ownership, auto titles, insurance policies
- Home improvement records
- Health records, wills and powers of attorney
- Birth certificates, adoption and custody records, death certificates
Documents to Keep Temporarily
- Paycheck stubs until reconciled with W-2 or 1099 forms
- Phone and utility bills for one year (or seven years if business-related)
- Monthly bank and credit card statements for one year
- Monthly mortgage statements for one year
- Brokerage or mutual fund statements until they’ve been reconciled at year end
- Year end statements from credit card companies for seven years
- W-2 and 1099 forms for seven years
- Cancelled checks and receipts for all tax-deductible expenses for seven years
Discard or Shred
- ATM, bank-deposit slips and credit card receipts after cleared on a statement
- Non-tax deductible receipts for minor purchases
- Old magazines and articles not read within the past six months
- Receipts, instructions and warranties for items you no longer own (or warranties that have expired)
Technorati Tags: paper clutter,tax time,papers to keep for tax time,tax season,what papers should i keep,what papers can i throw away
good things to keep in mind.
Thanks for the reminder. Paper does tend to accumulate if you don’t stay on top of it!
You’re welcome.
Pretty much, I follow this. If I used it for my income tax returns, then I definitely need to keep it. I keep a regular pile of junk mail (credit card apps) that I shred regularly and then about every 3-6 months I look through my stuff and have a big shredding party. The paperwork we need to keep is insane!!!! I do have a desk downstairs that I need to get rid of. I just need to buy a file cabinet instead to keep all this crap! :sigh: As always, thanks for the good tips.
Last summer I did a lot of research regarding tax records. I contacted the Tax Advocacy Office in every state to confirm if scanning support documents (receipts, etc) was an acceptable form of record keeping. The majority said no. It was also recommended that individuals keep w2 forms for a lifetime. The IRS only keeps these records for 10 years and W2 might be needed for collecting Social Security due to you. You may need to provide proof if there is a problem. (If Social Security is even around when we are old enough to start collecting :))
Thanks Karen!
@Cathy - Great info. Thanks!
I’ve been giving this list some thought and I do want to agree that you need to keep your homeowner’s receipts. If you live in your home for less than 2 years, then you have to pay taxes on the profits. Those receipts will certainly help.
Then, if you live in a home as your primary residence for more than 2 years, there is a certain amount that you can make. I think it’s $250,000 for a single filer and $500,000 for filing joint. Although that may sound like a lot of room for profit, if you’ve owned your house for a long time or you’ve made a lot of improvements, then it may not be hard for you to make that much.
Those receipts can really come in handy to avoid paying taxes on profits.