What records do I need to keep and how long do I have to keep them?
Author: Aidon Hughie Bilbao
Website: http://www.about-home-based-business.com
Added: Sat, Oct 28, 2006 9:49:23
Category: Home Based Business Questions
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Obviously, every personal finance and investment record you have cannot be kept forever. Nor do they need to be. Destroying records that will not be used anymore is a part of organizing your financial records. Following are suggestions about which records you need to keep and the length of time to keep them:
- Taxes - Keep your tax information and documentation for seven years.
- Tax Returns - Keep them three years; the Internal Revenue Service (IRS) audits your returns within three years, if they are ever going to.
- Cancelled checks and receipts - Keep for three years.
- Records for tax deductions taken on tax returns - Keep for six years.
- IRA contributions - Keep these records indefinitely.
- Retirement or savings plan statements - Keep these permanently.
- Bank records - It depends. It is advised that you keep bank records related to taxes, business expenses, home improvements, and mortgage payments as long as they are useful to you. Shred all records which have no long-term importance.
- Brokerage statements - Keep these until you sell the securities.
- Bills - It depends. Bills for big purchases such as jewelry, automobiles, furniture, and other such things should be kept in an insurance file as a proof of their value in case of loss or damage. Keep these records for as long as you still own the items.
- Credit card receipts and statements - Keep from 45 days to seven years.
- Paycheck stubs - Keep for one year.
- House or condominium records - Keep these at least six years to permanently. Keep records with relation to the purchase (buying price and closing costs), the cost of all permanent improvements (such as building a garage or re-roofing), and other expenses that you incur in buying or selling the property, such as legal fees and your real estate agent's commission.
keywords: Home Based Business | Home Business | Work at Home | Small Business | Entrepreneur | Taxes | Tax About the Author:
Aidon "Hughie" Bilbao answers frequently asked home based business questions at PrettyGreatAnswers.com.
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