Your Well Being And Taxes
The IRS recently published a newswire urging people to safeguard their records. IRS Acting Commissioner, Kevin M. Brown stated, "With forecasts calling for an active Atlantic hurricane season, the IRS encourages taxpayers to protect tax and financial documents that can be hard to replace." (Newswire dated June 1, 2007)Actually whether or not you live in a hurricane area, there are many things that can happen to destroy important records. We all think about big natural disasters such as hurricanes, tornadoes, earthquakes, etc. But there are other disasters that can affect anyone no matter where you live.
They include such things as fires, flooded basements, theft, accidentally throwing things away, etc.If you happen to get audited, the IRS doesn't particularly care why you no longer have your records and they will go off the records they can gather. The IRS can provide you with W-2 information, income from interest, dividends, stock sales, 1099 information, interest paid on government student loans, and how much mortgage interest you paid to a financial institution. They don't have records of business deductions, donations, dependents, alimony paid, daycare expenses, medical expenses, etc.There are several ways you can choose to keep your records safe.1. Paperless Record keeping: With the wide use of computers, internet bank records, W-2 forms, and other documents can easily be downloaded to your computer.
Other documents can be scanned in. This can then be saved onto a USB drive as a back up which can be store in a safety deposit box and/or sent to a relative in another city.2. CD or DVD: Records can be scanned into the computer and burned onto a CD or DVD. Several copies can be made inexpensively and stored in several places.3. Record Keeping Companies: There are companies that will copy and keep your records in their vaults so that in the case of a disaster they can provide you with a copy.
4. Protective Boxes and Safes: You can purchase fire proof and water proof boxes and small safes to keep valuable records in. They can work well if you don't live in a place were place where a natural disaster will likely take down the entire house.Other items you may want to document and keep safe are personal records such as birth certificates, social security cards, passports, insurance documents, home closing documents, and investment documents. In large disasters, it is important to be able to prove who you are and that your children belong to you. If your home is destroyed you may need to prove ownership.There once was a family of eight.
One evening the whole family went to the local pool for an evening of swimming and fun. They were gone about two hours and when they arrived home, their home was on fire. The fire department was there and the neighbors had all been frantically trying to find them. The plug on their toaster had shorted out and started the fire. It was a small fire that was quickly contained, but the fire department wouldn't let the family go in until they were sure everything was safe, which took a day. They stood there with nothing but their swimsuits and towels as neighbors ran to their homes to find clothing and diapers so the family could at least get dressed.When they were finally able to enter their home, the smoke had damaged everything.
They include such things as fires, flooded basements, theft, accidentally throwing things away, etc.If you happen to get audited, the IRS doesn't particularly care why you no longer have your records and they will go off the records they can gather. The IRS can provide you with W-2 information, income from interest, dividends, stock sales, 1099 information, interest paid on government student loans, and how much mortgage interest you paid to a financial institution. They don't have records of business deductions, donations, dependents, alimony paid, daycare expenses, medical expenses, etc.There are several ways you can choose to keep your records safe.1. Paperless Record keeping: With the wide use of computers, internet bank records, W-2 forms, and other documents can easily be downloaded to your computer.
Other documents can be scanned in. This can then be saved onto a USB drive as a back up which can be store in a safety deposit box and/or sent to a relative in another city.2. CD or DVD: Records can be scanned into the computer and burned onto a CD or DVD. Several copies can be made inexpensively and stored in several places.3. Record Keeping Companies: There are companies that will copy and keep your records in their vaults so that in the case of a disaster they can provide you with a copy.
4. Protective Boxes and Safes: You can purchase fire proof and water proof boxes and small safes to keep valuable records in. They can work well if you don't live in a place were place where a natural disaster will likely take down the entire house.Other items you may want to document and keep safe are personal records such as birth certificates, social security cards, passports, insurance documents, home closing documents, and investment documents. In large disasters, it is important to be able to prove who you are and that your children belong to you. If your home is destroyed you may need to prove ownership.There once was a family of eight.
One evening the whole family went to the local pool for an evening of swimming and fun. They were gone about two hours and when they arrived home, their home was on fire. The fire department was there and the neighbors had all been frantically trying to find them. The plug on their toaster had shorted out and started the fire. It was a small fire that was quickly contained, but the fire department wouldn't let the family go in until they were sure everything was safe, which took a day. They stood there with nothing but their swimsuits and towels as neighbors ran to their homes to find clothing and diapers so the family could at least get dressed.When they were finally able to enter their home, the smoke had damaged everything.
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