With tax season behind us, a viewer asks, “How long should I keep my tax records?” Well, for that matter, let’s ask our Moneyman – Paul Fain, president of Asset Planning Corporation – how long should we keep all of our financial records?
PAUL, LET’S START WITH TAX RETURNS, HOW LONG DO WE NEED TO KEEP THEM?
- 3 years: Time limit for an audit.
- Keep: forms, receipts, canceled checks, charitable donations.
ARE THERE REASONS TO KEEP SOME DOCUMENTS LONGER?
- Copy of tax returns.
- W-2s: verify income for Social Security benefits.
WHAT ABOUT INVESTMENT RECORDS?
- 7 years: documentation of bad debt or investment.
- Indefinitely: investment purchase history (used for gain/loss calculation upon sale).
…AND HOME-RELATED RECORDS WE SHOULD KEEP?
- Purchase and Sale documents.
- Receipts for home improvements.
FAST MARKET FACT: The average tax return is $3,046
What should we do with a refund? Balance is important!
- Pay down debt.
- Add to savings.
- Have some fun.
- Give to charity.
- Invest in yourself.
QUESTION FOR OUR MONEYMAN?
Send them to Paul@assetplanningcorp.com!
You can also reach Paul by using the contact page on APC’s website.