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    How Long Do I Have to Keep This Stuff?

    “How long do I have to keep this stuff?” is the usual question you ask yourself when feeling that you are running out of room for all this “paper” that may never be needed. 

    The paper receipt you get from your fast-food lunch may go directly into the trash.  The prudent consumer may keep it to reconcile it with their monthly statement and then, trash it.  The natural hierarchy with receipts and documents associated with purchases is that as the price or value goes up, the more important it is to keep them.  The question becomes “but for how long?”

    The following table will give you an indication on how long certain documents related to your home need to be kept according to best practices of tax professionals.  IRS recommends that records are kept for three years from the date the taxpayer files their original return or two years from the date the tax was paid, whichever is later.  There is no time limit in the case of fraud or failure to file a tax return.

    DocumentLength of time to keep
    Home Purchase/Sale Documents
    Home purchase documentsDuration of ownership + 3 years
    Closing documents & statementsDuration of ownership + 3 years
    Deed to propertyDuration of ownership
    Home warranty or service contractUntil expiration
    Community/Condo Association CovenantsDuration of ownership
    Receipts for capital improvementsDuration of ownership + 3 years
    Mortgage Payoff statements or Release of LienForever, in case proof is needed
    Annual Tax Deductions
    Property tax statement & cancelled check3 years after IRS due date for return
    Year-end mortgage statements3 years after IRS due date for return
    Federal tax returns3 years after filing return or
    2 years after paying tax, whichever is later
    Insurance and Warranties
    Home InventoryKeep current
    Homeowners insurance policyUntil the replacement is received
    Service contracts and warrantiesUntil warranty/service contract expiration
    Home repair receiptsUntil warranty/service contract expiration

    Going digital with your records can make them easy to keep as well as to find when you need them.  Create a folder on your computer that automatically backs up to the cloud like Dropbox, Google Docs or OneDrive so that if something happens to your computer, you have them safely tucked away. 

    The main folder could be the address of your home with subfolders for purchase documents, capital improvements, warranties, etc.

    When you receive statements that are already in digital format, simply move them to the correct folder and subfolder.  If it is a paper format, scan it and save it in the proper folder so you will have it when you need it.

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