Mark E. Buckley

Record Retention

How long should you keep paperwork?

You might need legal or financial papers for different situations. I would generally hold onto paperwork. You might just need a system to organize it better. You could buy storage containers and just label them by year. Once you have closed your books for that year, start a new container. Containers should be kept handy for the current and prior year. Then earlier years could be put in the attic or in storage.

The IRS web site has specific guidelines on how long records should be kept for tax purposes. Please refer to the IRS for specifics.

In general paperwork related to an asset should be kept as long as you have that asset. I would also keep it for an additional three years.

Paperwork related to employment should be kept at least four years.

Other tax related paperwork should be kept at least three years. Some exceptions apply where you would need to retain the documents longer.

Personally I keep all my tax records since 1989. I also have all my real estate paperwork since 1991. I keep all my insurance policies, but toss out sales materials and premium invoices. Other items such as invoices and receipts that are not tax related I hold onto for about a year. I used to use a large metal file cabinet. I now use these plastic containers that hold more and take up much less room. Just keep the current records in the top bin.