financial record keeping


A

anoop

I realize this may not be exactly on-topic for this
group, but I thought this would still be the best place
to get some good answers on this.

I have been filing away all paperwork and my filing cabinet is
now overloaded. I was hoping to be able to get rid of some of it.

So how long is one expected to hang to:
- Tax returns
- Supporting paperwork for tax returns
- Phone bills
- Utility bills
- Credit card statements
- Bank statements/cancelled checks
(including those from closed accounts)
- Brokerage statements
- Stock transaction paperwork
- ESPP stuff that's been sold
- Stock option stuff that's been sold or was worthless
- 401(k) statements
- Medical bills
- Car maintenance and registration records
- Auto and renters insurance
- Old employment letters
- Old paystubs

Thanks,
Anoop
 
Ad

Advertisements

R

Rich Carreiro

anoop said:
So how long is one expected to hang to:
- Tax returns
I just hold them forever. The returns themselves aren't
terribly big, so that's no big deal.
- Supporting paperwork for tax returns
Since I keep that stuff with my returns, it's easiest
to just keep it forever, as opposed to having to pull it
out of the tax return folders after 3 (or 7) years.
- Phone bills
- Utility bills
- Credit card statements
- Bank statements/cancelled checks
(including those from closed accounts)
Unless a particular bill/statement/check documents a deduction, these
all go at the end of the year. And there's no reason why they
couldn't go after 60 days. For no particularly good reason, I keep
the final statement from closed accounts.
- Brokerage statements
My broker sends a special year-end statement (different from
the 12/31 account statement) that lists *all* transactions
over the past year, along with realized capital gains and losses.
That statement plus any broker confirms for specific-id sales go
with the tax return. All the monthly statements get thrown out.
- Stock transaction paperwork
- ESPP stuff that's been sold
- Stock option stuff that's been sold or was worthless
I keep the stuff needed to document the gain/loss with the
tax returns. The legalese stuff is kept for a couple of years
after the stock has been disposed of and is then pitched.
- 401(k) statements
We get ours quarterly. I just keep the most recent one.
- Medical bills
Don't have many (crosses fingers) so just keep them all.
- Car maintenance and registration records
I keep all the maintenance records. I figure they may add
value to the car if I sell it. Registration records get
tossed each time the registration renews.
- Auto and renters insurance
I keep my most recent copy of the full text of the policy
and my most recent declarations page and proof of premium
payment. If there was an ongoing claim, I'd keep the declarations
page and proof of premium for that policy year.
- Old employment letters
I just keep all those since they don't take much space.
- Old paystubs
These can all go once your W-2 comes in. I keep the final
stub of the year, though, to document vacation/sick time carried
in to the next year.
 
S

Sgt. Sausage

Rich Carreiro said:
I just hold them forever. The returns themselves aren't
terribly big, so that's no big deal.
Maybe in your world.

Mine are (currently) about 2
inches thick, and and we measure supporting docs
by the foot. I've currently got about 12 and a
half feet of documentation stacked in a closet.
This covers roughly one decade. The way I see it,
"forever" -- given current actuarial tables, leaves
me somewhere between 4 and 5 more decades. At current
rates, that would mean I'd have about 60 lineal feet
of documentation by the time "forever" came around.
That's a stack of of papers as tall as a 6 story
building.

Sheesh. Who's got enough space for that?

We're currently on a "10 year and burn it"
plan. Makes good fire starter for the fireplace.






..
 
B

Bill

We print all of our tax returns and supporting documentation to PDF files
and store them on a rewritable CD in a safe deposit box. We have 12 years
worth on a single CD with plenty of room to spare. It is easy to do if you
use accounting and tax software.
 
R

Rich Carreiro

Sgt. Sausage said:
Mine are (currently) about 2
inches thick,
2" thick? What the hell are you doing? Day-trading
like a crazy man? :)

I've never had a return that was more than
10 sheets of paper. Supporting docs are
at most 0.5".
 
A

anoop

Sgt. Sausage said:
We're currently on a "10 year and burn it"
plan. Makes good fire starter for the fireplace.
According to:
http://bottomlinesecrets.com/blpnet/article.html?article_id=27624

"Trap: The IRS can always create a situation in which it
says no time limit applies to your return by alleging that
you never filed or that you committed fraud on your return.

You'll need copies of your return to refute such an
allegation -- so the safest practice is to keep your
returns forever."

Different sites say different things about how long
one should hold on to one's old returns which is
what bothers me about throwing them away.

I posted here to get an idea of what most folks do.

Anoop
 
Ad

Advertisements

A

anoop

Bill said:
We print all of our tax returns and supporting documentation to PDF files
and store them on a rewritable CD in a safe deposit box. We have 12 years
worth on a single CD with plenty of room to spare. It is easy to do if you
use accounting and tax software.
Don't you need paper proof to back things up? The stuff I've
read on the web seems to suggest that the IRS might require
original documentation and might not be happy with entries
in Quicken or Money.

Anoop
 
R

Rich Carreiro

anoop said:
According to:
http://bottomlinesecrets.com/blpnet/article.html?article_id=27624

"Trap: The IRS can always create a situation in which it
says no time limit applies to your return by alleging that
you never filed or that you committed fraud on your return.
(1) If you mail your returns in using certified mail, the
statute and case law says you have created a presumption
that you filed. The burden of proof is on the IRS to
show otherwise. They have to refute your claim that you
filed, not you refuting their claim you didn't file.
(2) It's not as simple as the IRS alleging you committed
fraud. After six years they have to have evidence
to back them up if they want to open someone's return.
They can't just wake up one day, pick a return out of
a hat, and say "we allege Joe Smith's 1992 return
is fraudulent."
(3) Just how does possessing a copy of your return
prove you filed it? Possessing the certified mail
form if you went that route, sure. But I don't see
was possessing a copy of the return gets you in terms
of proof of filing.
(4) Likewise, how does a copy of the return help defend a
fraud charge -- after all, if the IRS is coming with
a fraud case they are claiming the return is *wrong*.
So what does a copy do for you?
 
A

anoop

Rich said:
(4) Likewise, how does a copy of the return help defend a
fraud charge -- after all, if the IRS is coming with
a fraud case they are claiming the return is *wrong*.
So what does a copy do for you?
If you had a copy of the return and all of the supporting
documentation, at least you'd be able to explain your rationale
for the way you did things at the time of filing.

Anoop
 
B

BreadWithSpam

Sgt. Sausage said:
Maybe in your world.

Mine are (currently) about 2
inches thick, and and we measure supporting docs
by the foot. I've currently got about 12 and a
Is it all generated by software?
Can your software generate PDFs?

Keep the paper copy for a couple of years, and keep
the PDFs on your hard drive (and backed up using your
standard backup techniques).

Unfortunately, I've had a lot of trouble in the past
getting certain tax software to generate PDFs. Last
year I used TaxCut and they did something weird with
how it hit the print settings dialog box so that I
was unable to get it to generate PDFs, even on my Mac
where PDF-generation is built in.
 
A

anoop

Unfortunately, I've had a lot of trouble in the past
getting certain tax software to generate PDFs.
I couldn't get Turbo Tax to print all of my worksheets
to PDF. It would only print some of them. So for now
I just have a hardcopy.

Anoop
 
Ad

Advertisements

W

Will Trice

anoop said:
I couldn't get Turbo Tax to print all of my worksheets
to PDF. It would only print some of them. So for now
I just have a hardcopy.
The online version of TurboTax gives everything as PDFs.

-Will
 
Ad

Advertisements

B

BreadWithSpam

anoop said:
I couldn't get Turbo Tax to print all of my worksheets
to PDF. It would only print some of them. So for now
I just have a hardcopy.
Just a followup. I did mine with TurboTax on the Mac
and it Apple's built-in "Print to PDF" button worked
just fine this time.

Last year, TaxCut wouldn't do it. FWIW.
 

Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Similar Threads

Keeping Financial Records 4
record keeping 3
Australia Record Keeping 0
Record-Keeping Question 10
impact of not keeping record 0
Basic Record-Keeping Question 3
How important is record-keeping? 8
Record Keeping - a few questions 1

Top