On Your Side: When to shred old tax documents and other sensitive papers
SPRINGFIELD, Mo. (KY3) - Hopefully, you’ve filed your taxes by now. The deadline was Tuesday. The post-tax season is when you want to do some file cabinet maintenance.
When can you shred it? Tax experts tell On Your Side it depends on your situation.
“If you keep your records hard copy for more than ten years, you’re doing more than most people have,” said Tiffany Cossey, Drury University School of Accounting.
The IRS website has advice on what to keep and for how long.
Keep employment tax records for four years. Keep records for six years if you fail to report your income. Scan and save on a hard drive.
“Even if you throw away your paper copies, you still have the documentation forever. So if the IRS needs something from seven years ago, you’ve got it,” said Cossey.
While we are on this topic: Keep credit card statements for 60 days unless they include tax-related expenses. In these cases, keep them for three years.
For big-ticket items, like a major appliance, keep until the warranty expires, or you can no longer return or exchange them.
Keep medical statements for up to three years. Keep records of paid loans for seven years.
Keep important documents in a safe, locked place.
“I recommend somewhere that is not too hot. So an attic can be a problem if you have heat transfer receipts because it can make them black. A basement can be problematic. Sometimes those get damp. Pipes can leak on them. You want to avoid storing them anywhere where they can get wet or too hot,” said Cossey.
A closet might be your best bet. Never put personal documents in the trash. A warning, not all shredders are the same.
“If you are going to shred yourself, make sure you have a cross-cut shredder. Because if it shreds in strips, that’s pretty easy to put together. It’s an easy puzzle,” said Cossey.
You can always burn documents too.
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