Paper Clutter

[cjsmith]

Counting the deep drawers in desks, I have nineteen file drawers in one room of my house. Ten of them currently hold my filed paper. (Well, okay, nine and a half. I just spent an hour throwing away stuff.)

Whether I go paperless or not, the first step is to throw out about six drawers' worth of files I don't need. For example, I have my pay stubs back to the beginning of my current job. Do I really need all my pay stubs for all my PREVIOUS jobs? Do not doubt for a minute that I have them, every one.

Comments

Thanks!

[cjsmith.livejournal.com]

Thank you for the guidelines!

How long should I keep the ones from small businesses with questionable accounting? (Those aren't very recent, but I do have some, so I'm curious.) Three years? Six? Just until their 1099 turns out to agree?

To be sure I understand: keep stock / real estate purchase records until after you've sold the item?

I always thought the 6 year rule was 7, but I don't know where I got that idea. So... even tax statements, you'd pitch after six years? (I have every one I've ever filed.)

Re: Thanks!

[dr-scott.livejournal.com]

If there's any issue which might require proof of the ongoing accounting errors, hold onto the stubs until it's resolved or moot (likely after a few years). Otherwise, if they agree with the 1099 and that's what you've reported, toss'em.

In practice 6 years is plenty, since almost all audits are done by 2-3 years from the tax year in question.

And yes, that's right -- anything which would be subject to capital gains, keep records of purchase and any adjustments to basis like capital expenditures and spinoffs. In practice, this means keep bills for improvements to your house, even if you don't expect to pay capital gains -- in California you might go above the exemption for personal residences after a few more years.

Re: Thanks!

[cjsmith.livejournal.com]

until it's resolved or moot

OK -- then I'm even out of the woods on the guys who 1099'd me what they OWED rather than what they'd PAID, since that happened about ten years ago now. Cool!

And yes, we've kept all the stuff for home improvement. That exemption for personal residences isn't unreachable for a house in this area.