How Long to Keep Financial Records

03 Jul How Long to Keep Financial Records

Health insurance policies and related documents are important to keep long term, too. So long as your health insurance is active, you should keep these records. If your coverage ended or you’ve moved to another insurance company, go ahead and toss paperwork once you’re sure you won’t need it.

Period of limitations that apply to income tax returns

Plus, receipts and other documents fade and smudge, becoming illegible, over time. Digital records also offer additional benefits such as streamlining your bookkeeping and accounting processes. Additionally, with proper file naming, categorizing, and labeling, digital records are much easier to search specific documents when compared to boxes and boxes of paper files and faded receipts. Documents such as tax returns, receipts, bank statements, or pay stubs can also be kept in a safe deposit box or simply a locked file at home. For electronic documents, store them in a password-protected folder on your desktop or another secure location.

• When you refer us, the person you refer will receive an email with a link to our website.
• An experienced management accounting provider can help you select a bookkeeping and accounting software that will pair well with a variety of financial-record-keeping apps.
• Many financial institutions and businesses now let you opt for electronic billing and statements, either through email or online account access.
• If there’s an urge to hold on to something not listed above, keep it.
• The guidelines may vary depending on your industry and circumstances.
• Many smartphones come with the capability to scan documents, and there are other well-reviewed scanning apps on the market.
• Plus, let’s not forget that paper records can fade, and are susceptible to damage.

Employee payment/tax records

Also needed to fulfill life insurance policies, pensions, death benefits, etc. This is one of the documents you’ll need to get shortly after someone dies. The documents that you need to file with the local registrar may also be available online. Some, such as vital records, may only be available for request in person from an authorized individual. If you do end up going the paperless route, remember to keep a backup copy of your documents in a secure second location, like a password-protected hard drive, or a secondary cloud storage service.

• Organizing your financial records can give you clarity about your current financial situation, making it easier to reach your financial goals.
• The Experian Smart Money™ Debit Card is issued by Community Federal Savings Bank (CFSB), pursuant to a license from Mastercard International.
• Taxpayers who received more than $5,000 in payments for goods and services through an online marketplace or payment app in 2024 should expect to receive a Form 1099-K PDF in January 2025.
• Vyde offers a secure online portal for organizing and storing financial information.
• Documents that fall into this category include non-tax-related bank and credit card statements, investment statements, pay stubs and receipts for large purchases.
• There have been instances where property issues weren’t discovered until decades later.

Free filing options

After you’ve had time to review your statements, you can dispose of the receipts. While there will be numerous records you’ll need to retain, there are also likely many you’ll be able to Accounting for Churches discard. Remember to shred any documents containing account numbers, birth dates, Social Security numbers or other potentially identifying information before you dispose of them. As you review your paper documents, consider if you can access these documents online or if electronic delivery is an option.

The same is true if you receive disability or unemployment benefits. Tax Records are required to be retained for a minimum of five years from the date of filing or due date of the returns whichever is later. While some business experts recommend that business owners maintain their tax records permanently, we recommend using the seven-year rule of thumb for maintenance of all tax records. Most lawyers and accountants recommend keeping supporting tax documents for at least seven years. As a rule of thumb, seven years is sufficient time for defending tax audits, lawsuits and potential claims based upon the “statute of limitations”. Filing electronically and selecting direct trial balance deposit remains the fastest and safest way for taxpayers to receive their 2024 tax refunds.

At least once a year, review and discard old and unneeded documents — both physical and digital. For physical records, shred — don’t just recycle — documents, especially those that include any personal information such as account numbers, birth dates or Social Security numbers. Organizing your financial life begins with getting your how long to keep financial records records in order.