The end of tax period marks completion of collecting and reporting the previous year’s financial statements and is commonly a breath of fresh air for business owners and the average working American. Filing taxes and accounting for your finances can be time-consuming, so mid-April represents moving on for the year. As soon as the returns are processing, many individuals struggle to identify exactly what to do with all of the paper files built up during a year and beyond. Take a look at which documents are ready for paper shredding after tax season.
Clear clutter and consolidate
Free your office space of mess after tax period by understanding when you can safely destroy specific files. In general, The IRS might audit a person’s taxes for approximately three years after the filing deadline, so the suggestion for off-site document storage is 4 years prior to having a file shredding company damage the info.
Keep in mind that safe destruction is not just required for confidential paper files. Individual or financial information kept on discs, CDs, flash drives or other digital sources that you no longer need ought to be handled by a business proficient in digital and hard disk shredding.
Exactly what should you hang on to?
Keep paper documents concerning itemized deductions. If you own things which are subject to depreciation, like furniture and devices used for your business, you need to keep receipts for as long as the products are diminishing. Also, records connected to real estate must be kept for as long as you have the home. If you are unsure whether or not to save a document, it is best to err on the side of care and save documents that can be or have been deducted for tax functions over the past couple of years.
A last pointer: Consolidate info when possible and clear you home or office of clutter with safe off-site file storage. Attempting to save years of records in your home or in your storeroom be dreadful if not correctly managed.
Make it easier on yourself by loosely preparing for the next tax period now. By doing this, when the time rolls around next year, you’ll have less of a burden. Remember to conserve any relevant personal or business-related receipts, both paper and digital. Beyond just saving this details, create a digital file or a paper binder with the records clearly arranged for simple reference next year.
Consider document scanning to create digital records for your W-2s, 1099s, bank statements and other important supporting files. For more back up, have a CD copy of your files in case files are lost or stolen.
Is it time to manage your records this tax season? Give us a call to see how we can assist you manage, gain access to, scan and destroy files at the correct time. PROSHRED® of Houston is the perfect shredding service for tax season.