How a File Room Cleanout Can Transform Tax Season

Close up of person looking through documents in a file box.Have you taken a moment to assess the chaos in your file room lately? Is it overflowing with a mishmash of documents from charity letters to utility bills and tax receipts, making it nearly impossible to find anything? If so, it might be time for a file room overhaul. Not only will tidying up your file room make it more manageable, but it can also streamline your tax preparation process. Here’s how a simple cleanout can revolutionize your tax season, along with some key considerations to keep in mind:

1. How Long Should I Keep Our Documents?

  • One Month: Those pesky monthly utility bills and transaction records can quickly clutter up your files. Once you’ve settled these bills, it’s best to securely dispose of them to prevent any potential data breaches. Consider retaining them until year-end if they support your tax return, but otherwise, clear them out to reduce unnecessary clutter.
  • One Year: Monthly bank and credit card statements are crucial until the end of the year for tracking expenses. However, once they’ve served their purpose, it’s essential to shred them to safeguard sensitive information. Similarly, hold onto pay stubs for the year to verify your Form W-2, then dispose of them securely.
  • Three to Seven Years: The IRS recommends retaining tax documents for at least three years, but they may request supporting documents for up to seven years after filing. Keep records like W-2s, 1099s, bank statements, and charitable donation receipts within this timeframe. Additionally, consider the needs of other financial institutions or creditors, which may require longer retention periods.
  • Forever: Certain documents merit permanent storage, including vital records like birth certificates, marriage licenses, and wills. Tax returns and payments, along with records of significant financial events, should also be retained indefinitely.

2. What Should I Do with Discarded Documents?

For optimal security and compliance, it’s crucial to properly dispose of discarded documents. Engage a local shredding company that is NAID AAA Certified to ensure irretrievable destruction of sensitive materials. These experts offer secure shredding services and environmentally-friendly recycling.

During your file room cleanout, utilize locked shredding collection containers to safeguard documents until pickup. Upon completion of your shredding project, you’ll receive a Certificate of Destruction for your records, providing peace of mind regarding document disposal.

At Richards & Richards, we simplify the document destruction process. We are Nashville’s oldest NAID AAA Certified shredding service and we offer on-site shredding, off-site shredding, and walk-in and drop-off shredding options. Let us assist you in decluttering your file room this tax season. Contact us at 615-242-9600 or complete the form on this page to get started.

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