When I was in school, I kept my important documents in a portable, plastic filing box. Mostly the box contained prOn tax returns and pay stubs because my parents kept copies of the really important stuff –loans, promissory notes and such. At least I assumed they did. My mother had a designated spot in her bedside night table where she stored current monthly bills, but I don’t think she ever retained anything that wasn’t going to result in the house being foreclosed upon or the car repossessed should the bill not be paid.
My parents conducted their personal finances and stored their records in much the same way that they parented – out of their asses. But, surprisingly, the bills were paid in a timely manner, and, the IRS, or any other government entity charged with collecting money from delinquent accounts, never darkened our mailbox. I guess my parents’ tax returns weren’t sufficiently interesting to be audited, and, the fact that they spent decades at the same address, paying the same monthly bills, year after year, never spawned any further attempts to squeeze any further taxes out of them.
Movin’ On Up
From the moment I moved out of that backwoods armpit of a town, I have been assailed with numerous attempts by tax collectors to strong-arm me into paying various occupational fees and other personal taxes. You see, when you relocate from bumblefuck, nowhere, that’s one less sucker taxpayer there is to finance the hyper-inflated salaries of the school board, and, the ever burgeoning population of oldsters. And they will do almost anything to keep the tax monies flowing from the residents who actually have jobs. If that includes chasing down a former resident for imaginary fees, then so be it. And if you happen to be an uninformed, former resident who also doesn’t keep personal financial records, then you’re their favorite target. You can look forward to an annual written threat of fines and/or penalties and/or prison.
Two decades and several states later, I continue to receive notices from my state of origin threatening to assess fines and penalties if payment is not forthcoming for various, mythical personal taxes that only exist in the mind of the collector. There is a hanging file folder in my cabinet dedicated specifically to these notices that I call the Don’t Get Cute With Me file. Once I am able to stop myself from laughing uncontrollably upon reading a notice, I typically respond with my own nastigram to the issuing body.
Some years they skip sending me a bill, I suppose, because the tax collector has either slacked off or the state just doesn’t need the money. I’m not quite sure what the reason is. Or maybe they just need a break from reading my retina-searing responses to their solicitations. I do so enjoy ramming irrefutable evidence to the contrary down their collective, bottom-feeding gullet.
I used to get angry about the notices, but now I am merely amused because it makes me wonder how many other dolphins the state has snagged in its tuna net. I know that I can’t be the only one , but I can believe that I’m probably one of the very few who keeps personal business records indefinitely. And now, thanks to the likes of Bernanke and Goldman Sachs, et al., the entire U.S. economy is circling the bowl, which means that it’s probably quite prudent for you to retain your personal financial records.
Keep Your Records
Many state and local governments are either completely broke or about to be insolvent, and, consequently, are desperately struggling to find income. Some cities are becoming quite creative in their quest for revenue, so don’t be surprised if a collection notice shows up in your mailbox for a long forgotten and since paid-for citation from a city that you lived in decades ago.
You remember the plastic file box that I used to keep – the same one that held, at most, half a dozen file folders? I have since graduated to metal filing cabinets. And while I used to just shove my documents into a folder just for the sake of storing everything in one, known place, now I neatly file everything from bank statements to monthly bills to tax returns in reverse chronological order and use a two-hole puncher to organize papers in fastener folders. I even print out labels.
I spend my life filing whether at home or on the job because I am a Paralegal by trade, and, so I retain personal financial documentation above and beyond what some small business owners do because I refuse to be shaken down. And what’s more, I retain those records indefinitely despite any guidelines issued by the Feds and/or State. Of course, such a comprehensive retention policy may result in having to rent storage space to accommodate your files, but I have found that via the abracadabra of electronic document scanning, it doesn’t have to be that way.
Provided that you back up your electronic files to physical media such as a CD-R, you need not worry about your hard drive crashing and/or the blue screen of death. All that you really have to worry about -after you scan your docs- is keeping an index since you won’t be able to dig through a box of discs in quite the same manner as you would a filing cabinet.
Your mileage may vary as to what level of priority you attribute to your own records, but personally, I don’t place even a single scintilla of trust in either financial entities and/or government bureaucracies to not screw me over and otherwise attempt to bleed every last nickel out of my paycheck based on their fraudulent record keeping endeavors.
Happy hole punching.
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