Simplifying My Life: Filing Versus Scanning Important Documents

cupofkindnessJuly 9, 2013

For those of you who have taken the time to scan important documents, have you found that this task has been worth the effort? How many times have you needed access to scanned documents? What is your system for organizing your electronic files of scanned documents? What do you advise for long-run permanent storage of past documents, such as tax records? Would scanned documents count in an audit?

We are drowning in papers, we have been for our entire marriage, and sadly, the stacks only grow deeper. The worst part is that my husband and I are divided on how to handle the paperwork. Thanks for your ideas and advice.

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Can you at least pare down what you have?

I keep paper.
Scanning takes more time(for me) than filing.
Hard drives can crash, and it would cost a fortune in ink to print out necessary documents.

I can only help with one of your questions.
I was audited.
The IRS wanted soooo much paperwork (actual paper, no electronic files!), and I had it all. I took the paperwork to my tax guy, who ran them through his uber-copier in a matter of minutes. Front and back of all the checks, etc. The documentation was 1.5" thick! Trying to find all that was needed in computer files would have been daunting to me, both on the research end and then the printing.

Good luck with whatever you decide!

    Bookmark   July 9, 2013 at 11:42AM
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Definitely keep paper records for tax documents.

The only thing that I keep on the computer are the girls' immunization records and major medical dates and procedures. We often take advantage of immunization clinics before school and it's nice to not need to make a special trip into the doctor's office to pick up a piece of paper. Everything else is filed and sorted once a year to clean out no outdated paperwork.

    Bookmark   July 9, 2013 at 5:22PM
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We keep paper files for tax and other financial documents.

We keep our homeowners insurance policy at our workplace. This is so that if our house is damaged, we have easy access to an in damaged policy. If the office were damaged, we'd just ask the insurer for a reissue.

The one exception is our passports. I scan them and email the scan to my husband and both our kids and myself. If ever we were traveling and needed a copy, easy to access by simply logging into email.

    Bookmark   July 9, 2013 at 8:17PM
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I would love to sort thru all my paper work and scan the things I need to keep, but I don't have time for that. Plus, if I was going to start a scanning project, I'd much rather scan my old photos.

A few years ago, I tackled my paperwork and sorted everything by year (rather than by bank account, receipts, tax returns, pay stubs, etc.). I bought several big plastic folders, the kind that are not divided and have a zip closure. They are the size of the good old legal files that had the elastic cord. Anyway, I briefly flipped through my paperwork pile for each year and threw out what was not needed. I took the rest and shoved it into that years folder. I did not organize each years file. I figure if I ever need something, it will take less time to look thru it at that time than to perfectly organize all the filesnat once. I store the folders in a plastic bin in the attic. I have never gone up to the attic to retrieve old papers.

Now, I have a large basket in my closet for current years paperwork. During the year, I put all my bank statements, important receipts, pays tubs, etc. in the basket. Not organized, I just toss them in. On New Year's Day, I throw the years papers into a plastic folder and keep the folder handy for when the w-2's come in. Once my taxes are filed, I add the tax copy to the folder and put it in the attic. Meanwhile, my current year papers are still going in basket.

It's not a organizer guru kind of system, but its easy enough for me to stick with.

    Bookmark   July 21, 2013 at 9:10AM
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I don't have everything under control but it was a wonderful day when I put a laundry basket beneath the small desk in our entry way.

When mail comes in, I put all standard monthly bills inside without opening. I now have added a zip lock bag to the laundry basket and store all receipts/maintenance for the house in that laundry basket. At the end of the year, I pull out the zip lock bag and put that in my file cabinet for the house filed by year.

The rest of the stuff in the laundry basket goes into a kitchen trash sized bag with a stickup label on the outside that has the year. I store the bag in our loft which we use for storage (could put it in an attic or closet, etc.) At the beginning of the year, I make sure the laundry basket beneath the desk is EMPTY. This location is handy because I can sort my mail quickly.

I have two or three times needed to go into this basket in the years since I've been doing this. Once I remember I needed a water bill to show I was a city resident and could use the dump for hauling trash. I found what I needed within 10 minutes.

I have added a second ziploc bag to the laundry basket labeled "Annual bills/invoices/records" such as when I get our health and home insurance statements, (can't remember what else goes in there. )

This is still a work in progress but I LOVE having a place to immediately file. (I have another small pot I use for storing tax related stuff that comes in starting in January) and since we itemize, I have a small box close by for medical receipts that are kept file yearly. (Haven't figured out where or how or when to store blood test results, in progress)

Trick for me is to make it EASY to file immediately. I have a box for junk mail that I use for tossing, don't even open.
Then I take whole box (when it fills up) to Office Max store where they charge modest amount to shred. I don't even have to keep a shredder anymore.

As a result of this thread, I think I will change and find a new "Pot" for "IMPORTANT" and save and store on a yearly basis and don't throw away periodically.

I think filiing immediately and trying to avoid sorting until you must find something is a good strategy.

As a result of remodeling, I will have a new fairly nice sized closet near the entry way. I plan to put my "pots" in there. However, I don't think I will move the laundry basket. It has been such a life-saviour, I don't want to mess with a good thing.

    Bookmark   July 21, 2013 at 4:49PM
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"For those of you who have taken the time to scan important documents, have you found that this task has been worth the effort?"

No. Scanning is a complete waste of time.

"How many times have you needed access to scanned documents?"

Never. Scanning is used as an excuse to get hoarders to purge papers they think they need but really don't.

"What is your system for organizing your electronic files of scanned documents?"

If you scan documents, you should save them in folders on a flash drive or removable disc drive. If it really is important to you, you'll need to copy your drive to another drive -- always back up your back ups when you're dealing with electronic filing.

"What do you advise for long-run permanent storage of past documents, such as tax records?"

Individuals need only keep tax records for 7 years. Corporations should keep 10 years, just to be safe. You will only need these in the rare case of an audit; otherwise, you will never see them again. I suggest a file box or small plastic container with lid for each year of tax records (every year, toss the oldest records and replace with the current records).

"Would scanned documents count in an audit?"

Possibly, but you run the risk of them saying you doctored the information in some way. You should save hard copies where possible. However, most store receipt inks disappear after a year or two, so if you have any of those, scan them and print out on acid-free paper.

General rules about paperwork: Do not keep it longer than a year unless it was used as tax write-off, or it is a warranty on an expensive item, or it is a title, deed, insurance policy, long-standing legal document, or record of a current investment. Everything else can go.

    Bookmark   October 25, 2013 at 12:58AM
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