Asset Planning, Inc Blog

The latest from the team.
Font size: +
2 minutes reading time (383 words)

Record Retention: Keep it or Toss it

After your taxes are complete it is always a good idea to go through your records and organize what you should keep and what you can get rid of.

How long to keep records is a combination of judgment and state and federal statutes of limitations. Since federal tax returns can generally be audited for up to three years after filing and up to six years if the IRS suspects underreported income, it’s wise to keep tax records at least seven years after a return is filed. Requirements for records kept electronically are the same as for paper records. Many records can easily be kept on-line now and downloaded and to your computer, external drive or cloud account.

Records Retention Guideline # 1: Some items should never be thrown out

This is because these items would be hard to replace and you may be asked to provide them later in life. I suggest storing these “permanent records” in an expanding file or wallet – preferably in a fire safe box:

  • Income tax returns: if the return is uncomplicated then you only need to keep it for 7 years.
  • Important correspondence.
  • Legal documents.
  • Vital records (birth/death/marriage/divorce/adoption etc.).
  • Retirement and pension records.
  • Year-end investment statements.
    • If the investments are transferred to another account make sure the cost basis has transferred over correctly.
    • IRA non-deductible contributions (Form 8606).
  • Will and Trust documents.
  • Records of paid mortgages and other loans.

Records Retention Guideline # 2: Everything Else

You should retain these records according to the following guidelines:

  • Home purchase documents – Ownership period + 7 years.
    • Property records/builder contracts/home improvement receipts (keep until property is sold – needed for taxes)
  • Car purchase and sale records (keep until car is sold + 3 years).
  • Insurance policies (keep for life of policy).
    • If policy is changed to another company make sure that you keep the files together.
  • Sales receipts (keep for life of warranty or life of the item on large purchases).
  • Warranties and instructions (keep for life of product).
  • Medical bills – keep for 3 years or longer if there are any reimbursement questions.
  • No need to keep monthly statements for credit cards, bank statements, utilities, etc. if you receive a year end recap or are able to go online and view up to 3 years of statements.
×
Stay Informed

When you subscribe to the blog, we will send you an e-mail when there are new updates on the site so you wouldn't miss them.

Mortgage Rates Hit Historic Lows
CARES Act Stimulus Summary

Search Blogs Module

Wait a minute, while we are rendering the calendar
stock pile breach July 3 rd credit score cell phone carriers April 11 D premiums interest Financial Planning Magazine illiegal robocallers trust borrowing money tax season earthquake app pet donation drive summer identity theft fun atmosphere web address IRS credit cards Mobile Banking Security Tips non-prescripstion sunglasses cell phone service provider Medicare Part B premiums life saver Victor Dergunov Retirement Contribution Limits Medicare Advantage VOIP landline phones chip-enabled EMV cards September 8 checklists bottom line donation items memorial Day weekend home mortgages COVID -19 virus birth certificates prescription eyeglasses Supplemental Security Income family members pets July weekend disaster areas clients integral member cell phone SIM swap scam retirement vision screening payments media accounts markets wells Fargo settlement options https :// February 14 CFP ® Orange County ID card tax records check lists Part D premiums . home break-ins Auto insurance increase debt information Facebook IRS deadline September 9 privacy settings records Federal Trade Commission website Part B Social Security jury duty Coronavirus Aid TD Ameritrade president Trump self-help topics home emergency preparedness kits partner /owner account numbers notary services money FSA Economic Security Charles Schwab news coverage Facebook profile padlock pet industry 2018 IRA contributions ice cream Medicare “ skimmer ”. policy vacation Puerto Rico investment statements assets retirement planning 2017 IRA contributions phishing sites Medicare plan fun facts spread flash drive Wells Fargo employees https ://seekingalpha Ice Cream Social toilet paper Orange County Superior Court Joey Gonzales Open Enrollment retirement plans Roth IRA contribution limit emergency kits Kiplinger Letter estate planning Affordable Care Act team members gap insurance IRA accounts 70 1/2. 23 andme Labor Day paperwork clutter Amazon offering insurance Expired medications 2017 TD Ameritrade National LINC Conference holidays approach spam phone Flexible Spending Account EEChecklist-Kits.pdf stockpilingchecklist.pdf credit monitoring service National Ice Cream month Healthcare interest rates student loans official certification parking spots July 4 pet supplies June 29 operations manager donation counts documents 2017 Equifax breach Social Security Administration rescue organizations Erin Nelsen emergency kit health care costs people medications Medicare question relief efforts credit card fraud Two-Step Verification Asset Planning Fox News story Open House April 15 Independence Day estate planning direction text messages 20 year anniversary cell phone carriers offer July 6 car loans Treasury Department CERTIFIED FINANCIAL PLANNER exam retirement accounts identity thieves insurance policy trustee April 18 2017. Kraig Mathias 900 number drive /usb Wells Fargo customers blog post spring cleaning 4 pm -8pm house sitter home emergency kit Shred paperwork market turmoil clone counterfeits Legal robocalls portal years tax deadlines opt-out information estate banking executive order phone FEMA website health care services items phishing scams phone companies stimulus package fees ice cream event driver license paper records Medicare Part B home credit freeze home security privacy notices email notifications consumer spending earnings fallout pet app company emergency folder scams insurance policies January 10 tax filing deadlines September 30 2020. client portal October 1 2020. CA FTB cell phones 401K Notary Public CARES Act clients show support DNA test kits tax deadline water … asset Planning Brexit vote tax returns California Lions Friends cell phone provider business hours card reader credit card company coronavirus hurricane Dorian