Asset Planning, Inc Blog

The latest from the team.

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.
Continue reading
  696 Hits
696 Hits

Search Blogs Module

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