Since we “Mercans have to keep our tax information on hand for a rolling 7 year period (BORRRRING), that means we’re responsible for maintaining a record of certain receipts.
I have an HSA (Health Savings Account), which is similar to an FSA (Flexible Spending Account) and if you’re interested in the difference, check out this explanation.
So because I have an HSA account, I need to keep every receipt on medical purchases through that account. This means every;
- doctor copay
- doctor visit payment
- prescription payment
- any allowable over-the-counter purchase
- hopsital visit receipt, etc..
With myself and two kids, those receipts can add up for the year.
What I’ve done in the past is just slip them into the “HSA” folder I have in my file cabinet. They’re all lying around loose in there with absolutely no order. After hearing a horror story about a friend’s recent audit, I decided to tidy up that file, once and for all.
Here’s what I did:
1. Put all your receipts onto the floor. Then you can start sorting by year.
2. Make receipt piles by year. Although you may not be able to see clearly (slightly intentional-personal information and what not), the piles are organized from year 2008-2013.
3. Create envelopes for each year and set them aside, ready to be custodians of the tiny, pesky receipts.
4. Put the tiny receipts inside the envelopes – DON’T SEAL THEM, just in case – and paperclip them to the larger receipts.
5. Then, instead of putting these into one big “HSA” folder, put them into the corresponding tax year folders (that I’m hoping you have, if not – no worries, I can end up doing a post about how to organize those too…)
Now you can go in and add any future receipts (or old ones you run across), in the corresponding folder. If you ever DO get audited, heaven forbid, you’ll be glad you’ll be able to produce these on the spot. And no matter what, you’ll have some wonderful peace of mind in the meantime.
Let me know how it goes – Happy tidying!
- HSAs (health savings accounts) and health care FSAs (flexible spending accounts) (d104hsa.wordpress.com)
- Receipts: What Do I Need To Keep for Tax Time? (paysimple.com)