We all breathe a big sigh of relief when the tax deadline has come and gone. Provided we’ve done our taxes, of course. While it would be nice to leave the stress of tax preparation behind you and move on to more pleasant thoughts like spring weather, there are a few tax house-cleaning tasks that must be completed. One of those things is saving or discarding the documents you have used to process your tax return. What should you keep, and what should you shred?is important to prevent identity theft, and there are many other documents that you may have in your possession.
In many cases, we keep some documents for much longer than we need to. For previous generations, many people stored all of their information in large bank boxes that would build up in their storage spaces. If you head into a senior’s home, there is a good chance you could find a receipt for their water and gas bills from when they were younger. If you have these types of documents stored in your house, you can certainly discard them. If you are worried that there is sensitive information, you can contact a company that provides local shredding services to take care of it for you.
Documents to Keep
You should make sure to keep certain documents for specified periods of time, however. For instance, tax returns, and any documents you used as support, should be held on to for at least three to seven years depending on losses claimed. The IRS can perform a random audit on anything fewer than three years old. Accountants usually tell you to keep documents up to seven years, just as a precaution. The IRS has no time limit on auditing potentially fraudulent returns. They can also audit up to six years prior if they believe you underreported your income by more than 25 percent. There are even some accountants that feel that you should keep your tax returns for the rest of your life. This would be to help with possible estate disputes or other issues. Whatever the case, tax statement shredding is important to make sure that all of your personal information is destroyed.
What to Shred
In this day and age, there may not be much that you have to keep as a hard copy. Banks can provide statements from any time period, and many documents are stored digitally. That means you can do your tax statement shredding as long as you have a digital copy and a backup in case of any problems. If you have a lot of documents that you have built up over the year, or if you are concerned about identity theft, use local shredding services to take care of your documents for you.
What Should You Never Destroy?
There are many personal documents that should never be destroyed. Personal identification documents, such as your birth certificate and social security cards, should be kept safe and secure at all times. Your will and life insurance policies should also be kept safe. They may be kept at a lawyer’s office or a safety deposit box to make sure they they are always secure.
No matter what you shred, it is vital that you fully destroy the information that is contained on those pages. Local shredding services can provide you with the peace of mind so that you won’t have to worry about any information leaks.