Comments on: How long do I need to keep household paperwork (ie bills, pay stubs, W-2s, etc.)?

Question: How long do I need to keep household paperwork (ie bills, pay stubs, W-2s, etc.)?

keswick — Mon, 18 Oct 2004 19:09:51 -0800

How long do I need to keep household paperwork (ie bills, pay stubs, W-2s, etc, etc, etc.)?

By: PrinceValium

PrinceValium — Mon, 18 Oct 2004 19:27:15 -0800

Anything related to your income taxes needs to be preserved in paper. Everything else is less important. Thus:

Keep W2s, 1099s, and other tax documents forever.

Keep two pay stubs, replacing older ones as new ones come in. Sometimes you need them as proof of income when signing a lease or getting credit.

Keep all your utility bills until the next ones arrive, then throw them out on a monthly basis. Same reason: you need one as proof of residency for the motor vehicle department or the election board.

Sign up for online access to all your credit cards and other monthly obligations. No need to have paper copies of any of these bills as long as you diligently update your own electronic records.

You can throw away monthly statements from your investments, as long as you keep all year-end documentation such as 1099s and annual statements.

(By the way, when I say "throw away," I really mean "shred and throw away." Don't support your local dumpster diver.)

By: scarabic

scarabic — Mon, 18 Oct 2004 19:56:35 -0800

You may want tax records for your own purposes 20 years from now, but I don't think you can be audited for anything older than 7 years.

By: gluechunk

gluechunk — Mon, 18 Oct 2004 20:13:35 -0800

What do you mean by "need"?

I retain mostly all financial-related paperwork forever although I probably don't need it. If you organize it well (and store older items separately or off-site) then it doesn't take up much space. Some people like to just scan and digitally store all such papers, but I haven't taken that route yet. There have been times when I've wanted to research past electric rates or old cc APRs and I've been able to do that quickly.

I can't agree with the suggestion to keep utility bills for just a month. If you ever have to dispute matters, you'll want those old bills.

And don't rely on always having all that information available to you online via the companies' sites.

By: nakedcodemonkey

nakedcodemonkey — Mon, 18 Oct 2004 22:21:38 -0800

Keep two pay stubs, replacing older ones as new ones come in. Sometimes you need them as proof of income when signing a lease or getting credit.

Yes, you do, but usually it's more than a month's worth. On my last move, 6 mos was typical. For a big loan, like a mortgage, that's probably not enough either. I'd suggest keeping at least 12 mos worth, including all for the previous calendar year until you're done with your tax prep. They're handy for catching payroll errors (happens more often than it should) as well.

By: ikkyu2

ikkyu2 — Mon, 18 Oct 2004 22:24:59 -0800

I keep them for 7 years.

By: grouse

grouse — Tue, 19 Oct 2004 01:33:42 -0800

I keep pay stubs and income tax info for a long time (haven't thrown out any yet!). Bills are less important--a couple of years should be enough for any reasonable purpose. You might consider saving your last bill from a company in case they later claim you owed them money when you try to deal with them/credit bureaus later.

By: Irontom

Irontom — Tue, 19 Oct 2004 04:53:33 -0800

I was told once by a friend who was undergoing an IRS audit that if the auditor found "discrepancies", that s/he could then order additional audits going back as far as you have filed taxes in order to ensure that you hadn't been cheating over a long period of time. I have never looked it up to be sure, but this guy is pretty sharp, and thus my wife and I have all of our tax returns dating back to 1991.

By: fuzz

fuzz — Tue, 19 Oct 2004 07:01:34 -0800

Statute of limitations: The Code states that the IRS can assess tax or bring a suit to collect (unassessed) tax at any time in certain situations.

There are a lot of situations where you may have to prove that you were living in a particular place and paying bills a long time ago. I'm in one of those situations now, although as a long-term expatriate things are probably more complicated for me. The US legal system can be bizarre and draconian. I'd suggest keeping everything for a minimum of 15 years (or longer if you think maybe one day you'll want to run for public office).

By: agregoli

agregoli — Tue, 19 Oct 2004 08:57:01 -0800

15 years?!?! I barely have room to keep the three years I have on file now.

By: bonehead

bonehead — Tue, 19 Oct 2004 10:29:05 -0800

Scan and shread. PDFs are a lot easier to file than paper, and much easier to search.

By: kindall

kindall — Tue, 19 Oct 2004 10:49:44 -0800

Scan and shread. PDFs are a lot easier to file than paper, and much easier to search.

And not proof of anything at all. Keep the paper.

By: jacobsee

jacobsee — Tue, 19 Oct 2004 12:27:47 -0800

Some more suggestions

By: gimonca

gimonca — Tue, 19 Oct 2004 12:55:41 -0800

When I applied for my first mortgage, I had to supply paper copies of the previous x years' tax returns (three?). The one year I used "tele-file" was a huge headache--I had to run to both the IRS and the State tax office in person to get official paper copies.