How Long To Keep Your Parents’ Tax And Financial Records–And Your Own
Key takeaways
- A handy guide to what receipts, documents and tax forms must be saved, and for how long, to satisfy the IRS.
- What should we, his children, do with all that paper?
- A common example: If your parent owned a home at death, the property typically receives a step-up in basis to its fair market value as of the date of death.
A handy guide to what receipts, documents and tax forms must be saved, and for how long, to satisfy the IRS. Plus, tips for organizing, storing, scanning and shredding all that paper.After my dad died, my siblings and I began sorting through the things he left behind. That included the expected things, like clothes and photographs, and the unexpected things, like financial records tucked into places we hadn’t known existed. When we were finally able to open the locked cubby behind my dad’s bed, my brother found, among other things, copies of my dad’s tax records dating back to the 1970s.
My dad had saved everything. What should we, his children, do with all that paper? After death, certain old records can be shredded. But be careful–both tax filing and tax debts live on after death. And death also creates some new records that will need to be saved.
A common example: If your parent owned a home at death, the property typically receives a step-up in basis to its fair market value as of the date of death. In that case, decades old records supporting the house’s purchase price and the improvements made to it may no longer be needed for tax purposes—as they still are for your own house.