Now that the 2014-2015 tax season is just about over, it's a great time to clean house and get rid of old paperwork you don't need. But what should you pitch? And what do you need to save?
Yahoo Finance says you can safely toss the following papers after a certain amount of time.
Shred after one year
-Old credit card bills and statements.
-Utility bills.
-And cell phone bills.
But Yahoo says wait at least four years to shred:
-Bank statements.
-Insurance statements, in case you are filing or disputing a claim.
-And receipts for TV's, computers, and big ticket items, in case you need warranty work and need proof of purchase.
Yahoo Finance says save tax documents for at least 10 years, not the seven years the IRS and advisors recommend.
If you're audited, you may want to have 10 years worth of back paperwork, just to back up your case.
The report says never destroy:
-Papers proving you paid off your mortgage, car loan, or student loan.
-The front page of your 1040. You may want to know 20 years from how much your earned or paid in taxes.
Questions sometimes can come up about a car loan years after you paid them off (for instance, if someone uses in a crime), and having the documents will help greatly.
Even if it is a house you sold 20 years ago and have long since moved from, save the paperwork showing that it is no longer yours, in case a later owner or tenant is sued.
So feel free to pitch the old bills and receipts, but keep loan and tax documents as long as you can so you don't waste your money.
