How Long to Keep Important Papers?

Every year about this time my mailbox tells me it’s time to review the general guidelines on how long to keep statements, paid bills, and other important paperwork.

Today’s quick review should help you get your paperwork in order.


Here are the general rules for how long to keep important household papers:

One year

Keep pay stubs for at least one year so you reconcile them against both your W-2 Wage and Tax Statement (this is the form from your employer that shows how your annual earnings were allocated that you attach to your tax return) and the Social Security Earnings Statement you receive once each year in the mail (you can request a copy any time from

If your records do not match the entries on these forms you’ll be happy to have your pay stubs to prove your earnings and withholding.


As for receipts and records of bills paid, keep them as long as the situation is active.

Example: A paid water bill is no longer active once you receive the next statement that shows its payment was received and credited. But the receipt for your new water heater is. Attach it to the owner’s manual and warranty.

You can confidently destroy statements for closed accounts, expired warranties, canceled checks for minor items that are not proof of purchases or income tax related, and instructions for appliances or equipment that you have sold or discarded.

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Three years minimum

The IRS requires that you keep your tax returns and substantiating documentation as long as necessary to prove the validity of those returns. That means generally, you must keep your records that support an item of income, deduction, or credit shown on your tax return until the period of limitations for that tax return runs out.

There are some experts who say that means forever. Others say seven years is sufficient. That’s what the experts say; now you decide for your own particular situation.

Period of limitaations that apply to income tax returns

  1. Keep records for 3 years if situations (4), (5), and (6) below do not apply to you.
  2. Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return.
  3. Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction.
  4. Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.
  5. Keep records indefinitely if you do not file a return.
  6. Keep records indefinitely if you file a fraudulent return.
  7. Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

While owned

Keeping receipts for insurance purposes is a good idea, as long as you weed out the ones for items you no longer own.

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Some of your important papers should be kept forever: Birth records, military records, marriage and divorce records, death records, education and employment records, medical records, law suits and family history documentation.

RELATED: The Case for Keeping IRS and State Tax Returns Forever


You don’t need to spend a lot of money to get organized. Four boxes with lids plus a highlighter pen make a dandy system. Label the boxes: Active/Indefinite, Three Years, Seven Years, and Forever.

Get organized

Next, get all your paper work out and into one place. As you go through the stacks assess how much time has passed from the last date of activity.

Once you find the date on the document, highlight it so you won’t have to search for that date the next time you go through these items. Now assign each item to the proper box.

Consider scanning

Keep in mind that the IRS accepts electronic records. If you’re concerned about tossing paperwork you might later need, consider scanning everything first and maintaining a backup copy off site, either in the cloud or in a safe-deposit box.

Most insurance companies accept electronic records and scans of receipts, but don’t assume that yours does. Call and ask first.

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1 reply
  1. Bookworm
    Bookworm says:

    So timely for me, thank you. Because I have taken over managing our money from my husband who had a stroke, and he kept EVERYTHING(!), I really needed this. Now I’ll be able to reclaim some space.


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