Up This Week: Paperwork Organization
Tip of The Day: What/How long to keep that pesky paperwork!
I have discussed this before in the very early days of Organized To A T but paperwork can be incredibly overwhelming. What also gets overwhelming is the fact that you have to store it for years upon years and sometimes even forever.
But what exactly do you need to keep? That is the million dollar question my friends. Opinions vary wildly among experts. The IRS has a list, which is nice but seriously, who wants to sit on the IRS site and find the information? It makes my head want to spin around and then possibly explode. Below is a handy dandy pretty detailed list of what you should keep and for how long. But please DO NOT forget the number rule: If you have ANY doubt if you should toss something, please ask your accountant and/or lawyer. Yes, I used all caps, it is that serious because I'm pretty sure the IRS will not accept the excuse of "oops, I accidently shredded it" if they audit you.
Income tax returns
Income tax payment checks
Investment trade confirmations
Retirement and pension records
CPA audit reports
Marriage license (even if you have been divorced!) *see note below
Keep For Six Years:
Supporting documents for tax returns
Accident reports and claims (even if you still don't own the car)
Medical Bills (if tax related)
Property records/improvement receipts
Sales receipts (if tax related)
Utility records (if tax related)
Other bills (if tax related)
Keep for Three Years:
Credit card statements
Expired insurance policies
Car records (even after the car is sold)
Credit card receipts until verified on your statement
Mortgage/deeds/leases (keep for 6 years beyond the agreement)
Paystubs (until reconciled with your W-2)
Sales receipts (keep for life of warranty)
Stock and bond records (keep for 6 years beyond selling)
Warranties and other instructions (keep for the life of the product)
Other bills (keep until payment is verified)
I know this list can be overwhelming but once the initial push is done, all you are doing is adding papers to a file that is already created. When it comes to paperwork, it is the one area of organization I always error on the side of caution and suggest you keep more then you probably have to.
A funny story about keeping a marriage license, even if you are divorced: My parents were married in the mid-60's and divorced in the early 2000's. My mom, whether it made her sad to think about it or because she just didn't care, tossed their marriage license into a long forgotten file. Enter this year when she retired and applied for Social Security. Guess what she needed? Yep, her marriage license. Three days and 3 missed appointments at the Social Security office later, we finally found it. Needless to say I went through her paperwork like the ninja I am and it is MUCH better organized now.
Remember, life is easier when it's organized!