That said, you need very few paper documents as almost all financial transactions are now stored in cyberspace and can be accessed by the institutions quickly. I will share one personal account. In October of 2007, I purchased a built in microwave to replace our 9 year old model that died. I charged it to my MasterCard at Lowe's and in the process of installation, lost the receipt. Of course Murphy's Law lives at our house and the microwave broke after 10 months--less than the year warranty. A call to Lowe's with the model number of the unit and my personal information was all they needed to locate the receipt, make a copy and mail it to me. This provided the proof needed to have the repair covered by the warranty.
Retention Guidelines for Keeping Important Papers
|
Taxes--Returns
(With
accompanying documentation of receipts, etc.)
Records for tax deductions taken |
Three
to Seven years
The IRS has three years from your filing date to audit your
return.
The three-year deadline also applies if you discover a mistake
in your return and decide to file an amended return to claim a refund.
The IRS has six years to challenge your return if it thinks you
under reported your gross income by 25 percent or more.
There is no time limit if you failed to file your return or
filed a fraudulent return.
|
|
IRA contribution records
|
Permanently
If you made a nondeductible contribution to an IRA, keep the records indefinitely to prove that you already paid tax on this money when the time comes to withdraw |
|
Retirement/savings plan
statements
|
From
one year to permanently
Keep the quarterly statements from your 401(k) or other plans
until you receive the annual summary; if everything matches up, then shred
the quarterlies.
Keep the annual summaries until you retire or close the account.
|
|
Bank records and
statements
|
From
one year to permanently
Go through your records each year and keep only those related to your taxes, business expenses, home
improvements and mortgage payments.
Shred monthly
statements and keep end of year summaries.
|
|
Brokerage statements
|
Until
you sell the securities
You need only the purchase or sales statements from your brokerage or mutual fund to prove whether you have capital gains or losses at tax time. Shred other monthly statements. |
|
Bills/Purchases
|
From
one year to permanently
Go through your bills/receipts statements once a year.
In most cases, when the canceled check from a paid bill has been
returned or statement is reconciled, you can shred the statement. Keep only
those related to tax deductions.
Records for big purchases -- such as jewelry, rugs, appliances,
antiques, cars, collectibles, furniture, computers, etc. -- should be kept in
an insurance file for proof of their value.
|
|
Credit card receipts and
statements
|
From
45 days to seven years
Keep your original receipts until you get your monthly
statement; shred the receipts if the two match up.
Keep the statements for seven years only if needed for tax-related documentation.
|
|
Paycheck stubs
|
One
year
When you receive your annual W-2 form from your employer, make
sure the information on your stubs matches.
If it matches, shred all but then end of the year stubs.
If it doesn't, demand a corrected form, known as a W-2c.
|
|
House/condominium records
|
From
six years to permanently
Keep all records documenting the purchase price and the cost of
all permanent improvements -- such as remodeling, additions and
installations.
Keep records of expenses incurred in selling and buying the
property, such as legal fees and your real estate agent's commission, for six
years after you sell your home.
|
|
Legal Records
Medical History
|
Permanently
|
|
Medical Insurance, Medical Records
|
Keep insurance records as
long as premiums are paid and claims resolved.
Outstanding claims records
should be kept until resolved.
Records documenting tax deductions
should be kept with the tax returns.
|
Source: www.Bankrate.com. These are guidelines only. For more information, consult an accountant
or the IRS at: www.irs.gov
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