tax statement shredding, local shredding servicesWe all feel relieved after the tax deadline has come and gone, and our taxes are safely filed. That said, afterward, your home or office may be inundated with paper. Records, receipts, checks, statements, and other records may be stacked up in folders, no longer of use to you. What do you do with them, though? Should you discard of all of it? Tax statement shredding requirements can be slightly complicated, so here is a guide to what to do with your tax documents after you have filed.

Retention Guidelines for Individuals

A general rule is that you should retain records until the statute of limitations has expired. In most cases, that limit is 3 years from the filing due date. So, records from the 2013 tax year could have been discarded after April of 2017, since the filing deadline would have been 2014. There may be situations where the statute of limitations is longer than three years. For example, if you manage to underreport your earnings by more than 25%, the limit is six years. When it comes to not filing or filing a fraudulent return, there is no statute of limitations.

Here are some of the common tax documents that you might have, and the guidelines surrounding their disposal.

Tax Returns

It is probably a good idea to hang on to your tax returns indefinitely. Then, there can be no questions from the IRS as to whether you filed. If you must go through tax statement shredding to create space, then at least keep them for six years.

Real Estate Records

Real estate records should be kept for as long as the property is under your ownership, plus three years on top of that. Any receipts related to home improvements and insurance claims should also be kept, along with any financing documents. You may need these to prove the adjusted basis in the property, which has an effect on your taxable gain.

Stocks and Bonds

These should also be kept for as long as you own them, with an additional three years on top of that. Your records should be detailed, with the dates quantities, and prices, as well as any broker fees.

Document Retention and Tax Statement Shredding Guidelines for Businesses

Owning a business in Dallas or Houston means there are different guidelines and responsibilities involved in filing your taxes. You must worry about employee hiring and termination reports, for instance, and also employee earnings reports. These records should be retained for up to three years. When it comes time to destroy these documents, make sure to use local shredding services. Marshall Shredding offers local shredding services to make sure that any confidential and secure information that you have will be destroyed and unrecoverable. That way, your clients, and staff will be protected, as will the reputation of your business.

Make sure that you also hang on to things such as travel and entertainment receipts, as they may be taxable benefits. These should be kept for three years.

Digitization

You can store records electronically, but make sure to take care of tax statement shredding of the physical documents. Any digital storage system must meet the IRS’s requirements for security as well. Scan any documents you want to save, and then get your local shredding services to dispose of the hard copies.

Now that tax season has come to an end, make sure to follow all the guidelines for keeping and destroying your tax records.

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