Tax Season – What to Store and What to Shred
Tuesday, April 4, 2017
You’re knee deep in taxes for yourself and/or your home-based business, busily sorting through stacks of paper, organizing and trying to declutter and it’s easy to get stressed and just want to toss everything in the trash. Before you do it is important to know that, according to the IRS, both individuals and businesses are required to keep certain types of documents on hand. But which ones and how long can be confusing to figure out. Below is a list of requirements* that can help reduce the confusion:
· Three years: Tax return forms/schedules and supporting information for deductions claimed, especially property, investments, or business assets (for depreciation) records.
· Four years: Many income-taxing states have an additional year to audit individual returns.
· Six years: Forms W-2, 1099, etc. because the IRS has six years to contact you if you've failed to report income.
· Seven years: Any information regarding loss from worthless securities or bad debts.
Other documents should be kept a bit longer. For instance, records related to your home, property, investments and retirement plans should be held on to indefinitely and if you dispose of any assets add another three years. If you are a business owner, you’re going to want to keep tax records longer. Employment records, gross receipts, invoices, bank statements, proofs of purchase, asset records, databases, emails and even voicemails should be held onto for at least 4 years.
Now that you know what to keep you can just pitch the rest, right? WRONG! Garbage that is improperly disposed of is an identity thief’s’ playground and the last thing you want is to be the victim of a dumpster diving criminal. While using a paper shredder at home is better than tossing your person information into the kitchen garbage it is nowhere near as secure as utilizing professional document destruction company is far more secure.
Even better is that Document Destruction's residential paper shredding service is not only convenient and low-cost but we come to you and destroy your sensitive and confidential papers right in front of you. Contact us today and let us give you the peace of mind of knowing your important and sensitive personal information is secure.