The Real Estate Blog

How long should you keep records, receipts, etc?

January 4th, 2011 10:14 PM by Wendy Thomas

In the spirit of a New Year and starting the year by cleaning and purging, let's take a look at how long you should hold onto important documents.

TAX FORMS AND RETURNS:  Keep a copy of your tax returns for at least 3 years.  The IRS has three years to audit your files. In addition to that, when you buy a house, your lender will need to see copies of the last couple of years' tax returns, so keep it handy!  ** The IRS has the right to audit you for up to 6 years if they think that you grossly under-reported your income, so I would recomment holding on to these for up to 6 years if there's any doubt!

RECEIPTS RELATED TO YOUR TAX RETURNS: Keep these for as long as you keep the tax returns.

PAY STUBS: It's recommended that you keep a copy of your pay stubs for the last 12 months of employment. 

IRA AND 401K STATEMENTS: You should be fine keeping only the yearly statement from your account.  Other account information is usually easily accessible if you need it.

ATM AND BANK DEPOSIT/WITHDRAWAL SLIPS: You can throw away after balancing these with your monthly bank statement (or online).

BANK STATEMENTS:  You should keep for up to a year, but can get rid of after that point.  Now, you can access a lot of that information online, so you may not want to keep paper statements (or you may not even receive paper statements anymore).

CREDIT CARD STATEMENTS, TELEPHONE/UTILITY BILLS, CREDIT REPORTS: You should be able to safely toss these after 1 year.

Now is the time to create a simple filing system!  I'm the worst at tossing some of these items-- I'm always worried that I'll need something as soon as I get rid of it.  But it can quickly take over, and become hard to manage, if you don't set up some guidelines to go by.  Most of the suggestions above are recommended by the IRS website or Bankrate.com. 

Also remember to SHRED these items when you do get rid of them!

Posted in:General
Posted by Wendy Thomas on January 4th, 2011 10:14 PM

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