Each of us needs to keep records that substantiate our tax return or other important life events for as long as they are needed. So what does this mean?

The basic retention period. Federal tax return substantiation is generally three years from the later of the tax return filing due date OR the actual filing date.

State guidelines could be different. Understand your state and local audit timelines. Often states can review tax returns after your federal return is officially closed to a potential audit.

Keep some things forever. Some items should be kept indefinitely. These include, but are not limited to, copies of your 1040 tax return, major asset purchases and sales (i.e. home mortgage, home closing documents, investment/stock transaction documentation, major asset purchase/sale documents, insurance documentation, and birth/death/marriage certificates).

Keep valuable item receipts. Keep records of any other valuable items purchased. This includes jewelry and other collectables.

Finding the cost of stocks just got easier...and trickier. Stock and Investment companies are now required to report the cost of your investments to the IRS. So you will not need to dig around for old transaction information to prove what you paid for your investment. On the other hand, any errors on your investment statement also get sent to the IRS, so make sure the information provided is correct or it may create an audit trigger.

Others may want your documentation. You may need records for non-tax related purposes. Copies of divorce decrees, record of insurance, and home sale closing paperwork are common examples of documents needed for other reasons.

Federal recordkeeping guidelines could become longer. Federal guidelines for record retention are generally 3 years. However, errors on your tax return for over 25% of the tax obligation require record retention of 6 years. If fraud is determined, the record holding period is indefinite.

Floods, Fire, Hurricanes, and Tornados. We seem to read about these natural calamities every day, but rarely think that it will happen to us. But what if it did? Are you prepared? Here is a list of ideas that will help make sure your recovery from a disaster is less painful.

	3. Document your valuables. Create a full list of documents and valuables. Your financial documents, tax records, and important papers should all be copied and stored offsite. Consider creating a digital copy of your records and storing your paperless documents in a secure location and format. Take photos or video of your valuables and make copies of documents that will substantiate their value.
	4. Communications. Make sure you have a way to receive severe weather information. If you are using a battery operated radio, make sure the batteries are fresh. Having a back up set also makes sense. Consider purchasing an NOAA weather radio. Have a contact plan with family members and prearranged meeting places so you do not have to worry about each other's safety.
	5. People over property. Heed warnings and take cover. Know the disaster communication plan for your community. Too many people are hurt by ignoring warnings to leave an area or to take cover when severe weather is approaching. Remember property can be replaced, people cannot.
	6. Review your coverage. Once a year, review your insurance to ensure you have adequate coverage to protect your property and loved ones. If necessary, adjust your policies to include flood insurance or add riders on your policy to provide coverage for additional valuables like artwork and jewelry.

Want to know more? The Federal Emergency Management Agency (FEMA) has a great information resource for disaster preparedness called "Are You Ready" which can be found at www.fema.gov/areyouready