How Long Should I Keep My Documents ?

You may find yourself wondering which documents you’ve accumulated over the years that you can safely dispose of and which you should probably hold onto. So which documents should you retain and for how long?

INCOME TAX RETURNS AND SUPPORTING DOCUMENTS (INDIVIDUAL AND BUSINESS)

The IRS has a 3-year window of opportunity to audit you, but in some circumstances this can be extended to 6 years.  Therefore, we suggest keeping tax returns and supporting documentation for 7 years.

This recommendation applies to federal, state and franchise tax returns.

GIFT TAX RETURNS AND SUPPORTING DOCUMENTS

Keep indefinitely.

BUSINESS PAYROLL AND SALES TAX REPORTS

Keep for 7 years.

PURCHASE AND SALE DOCUMENTS

Keep for 7 years after the disposal of the asset.

This recommendation applies to real property, stocks and securities, and other personal and business property subject to IRS examination.

INSURANCE POLICIES AND CLAIMS DOCUMENTATION

Keep for 7 years after expiration.

LOAN OR LEASE AGREEMENTS

Keep for 7 years after maturity.

BUSINESS ORGANIZATION AND RELATED DOCUMENTS

Keep for 7 years after the entity’s dissolution.

This recommendation applies to formation documents, operating agreements, annual minutes, business plans, changes in ownership, and termination documents.

FINANCIAL STATEMENTS (AND AUDIT REPORTS IF APPLICABLE)

Keep for 7 years.

RETIREMENT ACCOUNT RECORDS

Keep indefinitely.

ESTATE PLANNING DOCUMENTS

Keep indefinitely.

This recommendation includes wills and trust documents, durable and medical power of attorneys, and beneficiary and guardianship designations

VITAL RECORDS

Keep indefinitely.

This recommendation includes birth, death, marriage, divorce, and adoption documents.

 

How Long Should I Keep My Documents.We hope that this list serves as a good starting point for which documents are best to retain. This list is not exhaustive nor are the retention periods fixed. Keep in mind that holding onto large stacks of paper documents is not necessary, and it is typically more efficient to scan and save your documents to a secure drive.

When in doubt if a document should be retained or tossed…

Be conservative:  SAVE IT!