Experts say that if properly stored the tax documents will not only help you in case of inspections or legal proceedings but also literally save your life. We will now tell you where, how and how long important documentation should be kept.
Days, when important documents, valuable materials, receipts are stored in a cardboard box on the top shelf in the closet or under the bed are gone from memory. In times of technological progress, paper copies are becoming obsolete while electronic storage is gaining popularity.
People are less willing to deal with paperwork. And it is clear:
- First, it takes a lot of time, paper and ink costs.
- Printed copies can be easily lost.
- As the law of injustice: when they are urgently needed they will not be at hand.
- And the most vital situation: someone can pour coffee on the documents and now they need to be restored.
Not all records need to be stored equally long. Tax experts identify 4 main groups of financial papers for the duration of their keeping.
Up to a year. These are notes as bank statements, pay stubs, annual insurance policies, and medical bills.
Three years. In this category, we can include checks for charity as well as some tax forms such as W2 and 1099 Form https://1099-misc-form.pdffiller.com/
Six/Seven years. Documents of the real estate reconstruction or sale and most federal returns and receipts.
Lifelong storage. Here we have Social Security cards, birth and death certificates, marriage license, property ownership certify. All the records to prove your identity, rights and status should be assigned to this category.
It has already been mentioned that important information should be stored for a certain time and be quickly accessible. The IRS may request previous tax reports and forms in case of an audit or you may need them applying for the loan.
It is very convenient to keep the documentation on digital devices and on the Internet. But keep in mind that any device can be damaged, lost or stolen. So the Internet is our choice.
Follow these 5 hints to be safe and secure:
- If we are still watching on the hard copies be sure to make and keep backups online. Don’t just throw away the papers but shred them after the end of the storage date.
- Use the password generator for online storage. Simple passwords could be easily hacked, but the special tool could provide you the high-level protection.
- You can download the program for passwords storing. So, no need to remember all the passkeys but only one to enter this program.
- There are online platforms where you can fill out existing tax forms, create your own templates and store them in folders. Choose those programs that have high encryption features.
- Make sure that you use the secured mail agent, don’t open archived folders from an unreliable sender or follow the suspicious links. Try two-step verification which will give access to your stock after two actions are completed correctly: password+code or password+captcha, etc.
The most useful and convenient services are those that store data on servers on the Internet, e.g., in the cloud, and have client applications for different platforms: Windows, iOS, Android with the ability to synchronize data between all devices. This is why they are so convenient and reliable.
But there are special solutions for the convenience of working with tax files online and not only. For example, PDFfiller and similar services allow you to find the required form or sample, create any new document and save it as a template, upload files to your account and perform a wide range of operations. You can also connect your account to your Dropbox, Google Drive, etc., and easily import your documents to be edited, signed, and shared. At the same time, your data will be securely protected and encrypted.