Recordkeeping

Presented by(Name, CPA)

Member, The Ohio Society of CPAs

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Why keep great records

• In an era of litigation, identify theft and increasing IRS oversight, keeping good records could make a difference in defending your assets.

• Recordkeeping should be methodical and consistent – a part of everyday life.

• Catching up takes time, but it is well worth the effort.

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Records

• Records are created whenever:–A service is rendered–A product is purchased or sold–A person or company is billed or

paid– There is a major life-changing

event

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Record storage

• Envelopes or accordion file• Filing cabinets• Computer (CDs)/Servers (NOTE: Use

the free auto backup service of your personal computer)

• Safe deposit boxes (costly or hard-to-replace items such as original birth and marriage certificates, property titles, passports, etc.)

• Off site electronic storage services

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Types of records

• Bank records• Residential• Personal property• Income and employment• Health and retirement• Legal• Taxes• Miscellaneous

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Bank records• TIP: Online banking is convenient, saves

time, paper and postage costs, but it is a good idea to print out copies of your bank records periodically.– Cancelled checks– Deposit slips– Bank statements– List of account numbers– Savings, checking account statements– Loan documents (car, mortgage, education)– Investment accounts, CDs, money markets– Credit card statements

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Residential

• TIP: Keep home appliance purchase and warranty information together and file alphabetically.– Home purchase– Home improvement– Household accounts– Warranty information– Service provider contact names, addresses,

phone, fax, email– Insurance policies

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Personal property• TIP: Consider video taping every

valuable item in every room in your house. Place the tape and personal property inventory in the safe deposit box. In case of a home fire or burglary – you have proof of ownership.

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Personal property– Net worth statement– Personal property inventories (keep

originals in safe deposit box)

– Property tax records– Receipted bills and sales slips for tax

deductible items–Warranties– Special insured items (jewelry, art, guns, collections)

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Income and employment

• TIP: Maintain insurance records and statement of benefits. Be sure to note any changes in plan benefits and maintain updated records.– Insurance plans– Paycheck stubs– Completed income tax returns and forms– Performance records (reviews and

evaluations, commendations, promotions, awards)

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Income and employment

• TIP: Maintain insurance records and statement of benefits. Be sure to note any changes in plan benefits and maintain updated records.– Retirement plans– Pension plans– Insurance policies– Resume– References and contact information

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Health and retirement

• TIP: Have a note taker join you on doctor visits to record what was said. File these notes with your medical records.– Health records of individual family members

(hospitalization, medications, diagnoses, contact information, consultation notes, test results, treatment plans, blood type, allergies)

– Doctors’ names, contact info, dates of visits– Living will– Power of attorney for health care/Disability– Elder care

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Legal• Marriage license• Birth certificate• Death certificate• Divorce decree and property settlement• Adoption certificate• Power of attorney• Wills, trusts, codicils, TOD• Living will• Titles• Diplomas• Passwords

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Miscellaneous

• Church records (donations, baptism, confirmation)

• Debt records and documentation• Educational records (transcripts, grades,

citations)

• Military service, discharge• Family business records• Receipts• Genealogy

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Important lists

• TIP: If your family members need to access your records at a moment’s notice, would they know where to look? Maintaining lists of what can be found where can reduce confusion and speed access.– Contents and location of safe deposit box– Credit cards with addresses and phone

number of contacts for card replacement– Credit card billing addresses, phone

numbers and payment dates

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Important lists (cont)

– Net worth statement– Personal property inventories (keep

originals in safe deposit box)– Insurance contact names, addresses,

phone, email, fax– Health care provider names, addresses,

phone, email, fax, emergency numbers– CPA, personal attorney and insurance

agent names

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Records and the IRS

• The IRS has three (3) years to audit Federal income tax returns (or two years from the date the tax was paid, whichever is later).

• This limit does not apply in "unusual" cases. If an amount of income that should have been reported was not reported, and it is more than 25% of the income shown on the return, the period of limitation does not expire until six (6) years after the return was filed.

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Records and the IRS

• There is no period of limitation when a return is false or fraudulent, or when no return is filed. (See IRS Publication #552, "Record-keeping for Individuals.")

• If audited you will need cancelled checks and/or payment receipts relating directly to entries on your tax return.

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Records and the IRS

• In some cases, it is advantageous to keep records longer than the typical period.– For example, when selling your

principal residence and claiming the capital gains exclusion allowed by IRS, documentation of original purchase price and capital improvements can be required.

– Cost of stocks, bonds etc.04/19/23 19

Records and insurance claims

• Check with your insurance agent or broker for company requirements of proof of purchase and/or ownership of real and personal property in the event of an insurance claim.

• In some cases, payment receipts are required; in other cases a written inventory and/or photographs is adequate documentation.

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Thank You

• If you have any questions or would like to discuss recordkeeping or other financial matters, please contact me:– Name, CPA– Company– Address– Email– Phone

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