financial record keeping

I just hold them forever. The returns themselves aren't terribly big, so that's no big deal.

Since I keep that stuff with my returns, it's easiest to just keep it forever, as opposed to having to pull it out of the tax return folders after 3 (or 7) years.

Unless a particular bill/statement/check documents a deduction, these all go at the end of the year. And there's no reason why they couldn't go after 60 days. For no particularly good reason, I keep the final statement from closed accounts.

My broker sends a special year-end statement (different from the 12/31 account statement) that lists *all* transactions over the past year, along with realized capital gains and losses. That statement plus any broker confirms for specific-id sales go with the tax return. All the monthly statements get thrown out.

I keep the stuff needed to document the gain/loss with the tax returns. The legalese stuff is kept for a couple of years after the stock has been disposed of and is then pitched.

We get ours quarterly. I just keep the most recent one.

Don't have many (crosses fingers) so just keep them all.

I keep all the maintenance records. I figure they may add value to the car if I sell it. Registration records get tossed each time the registration renews.

I keep my most recent copy of the full text of the policy and my most recent declarations page and proof of premium payment. If there was an ongoing claim, I'd keep the declarations page and proof of premium for that policy year.

I just keep all those since they don't take much space.

These can all go once your W-2 comes in. I keep the final stub of the year, though, to document vacation/sick time carried in to the next year.

Maybe in your world.

Mine are (currently) about 2 inches thick, and and we measure supporting docs by the foot. I've currently got about 12 and a half feet of documentation stacked in a closet. This covers roughly one decade. The way I see it, "forever" -- given current actuarial tables, leaves me somewhere between 4 and 5 more decades. At current rates, that would mean I'd have about 60 lineal feet of documentation by the time "forever" came around. That's a stack of of papers as tall as a 6 story building.

Sheesh. Who's got enough space for that?

We're currently on a "10 year and burn it" plan. Makes good fire starter for the fireplace.

We print all of our tax returns and supporting documentation to PDF files and store them on a rewritable CD in a safe deposit box. We have 12 years worth on a single CD with plenty of room to spare. It is easy to do if you use accounting and tax software.

I've never had a return that was more than

According to:

You'll need copies of your return to refute such an allegation -- so the safest practice is to keep your returns forever."

Different sites say different things about how long one should hold on to one's old returns which is what bothers me about throwing them away.

I posted here to get an idea of what most folks do.

Anoop

Don't you need paper proof to back things up? The stuff I've read on the web seems to suggest that the IRS might require original documentation and might not be happy with entries in Quicken or Money.

Anoop

(1) If you mail your returns in using certified mail, the statute and case law says you have created a presumption that you filed. The burden of proof is on the IRS to show otherwise. They have to refute your claim that you filed, not you refuting their claim you didn't file. (2) It's not as simple as the IRS alleging you committed fraud. After six years they have to have evidence to back them up if they want to open someone's return. They can't just wake up one day, pick a return out of a hat, and say "we allege Joe Smith's 1992 return is fraudulent." (3) Just how does possessing a copy of your return prove you filed it? Possessing the certified mail form if you went that route, sure. But I don't see was possessing a copy of the return gets you in terms of proof of filing. (4) Likewise, how does a copy of the return help defend a fraud charge -- after all, if the IRS is coming with a fraud case they are claiming the return is *wrong*. So what does a copy do for you?

If you had a copy of the return and all of the supporting documentation, at least you'd be able to explain your rationale for the way you did things at the time of filing.

Anoop

Is it all generated by software? Can your software generate PDFs?

Keep the paper copy for a couple of years, and keep the PDFs on your hard drive (and backed up using your standard backup techniques).

Unfortunately, I've had a lot of trouble in the past getting certain tax software to generate PDFs. Last year I used TaxCut and they did something weird with how it hit the print settings dialog box so that I was unable to get it to generate PDFs, even on my Mac where PDF-generation is built in.