---
name: paper-document-organization
description: |
  Creates a filing system for household documents including financial records,
  legal documents, medical files, warranties, and ongoing paperwork. Covers
  physical filing structure, retention schedules by document type, and a workflow
  for processing incoming paper. Use when the user asks about organizing
  paperwork, setting up a filing system, document retention periods, or managing
  household paperwork flow. Do NOT use for digital file organization, business
  document management, or general decluttering (use decluttering-method).
license: Apache-2.0
metadata:
  author: foundry-skills
  version: "1.0.0"
  tags: "decluttering checklist legal-literacy"
  category: "home-household"
  subcategory: "interior-organization"
  depends: ""
  disclaimer: "none"
  difficulty: "beginner"
---
# Paper Document Organization

## When to Use

Use this skill when the user's request matches one of these specific scenarios:

- User describes physical piles of paper, an overflowing filing cabinet, or years of unsorted documents and wants to establish order
- User asks how long to keep a specific document type -- tax returns, medical bills, bank statements, pay stubs, mortgage documents, receipts -- and needs a concrete retention period
- User is preparing for a major life event (home purchase, divorce, death in family, job loss, bankruptcy) and needs to understand what documents to locate and preserve
- User is setting up their first household filing system and has no existing structure -- newly independent adults, newlyweds merging households, recent movers
- User experienced or is anticipating a disaster (fire, flood, natural disaster) and wants to protect or reconstruct critical documents
- User is purging old paperwork and needs to know what is safe to shred versus what must be kept

**Do NOT use this skill when:**
- User wants to organize digital files, downloads, or scanned documents on a computer or cloud service -- use a digital-file-organization skill instead
- User is asking about document management for a small business, freelance business, or LLC -- business compliance, contractor record-keeping, and corporate document retention have different legal requirements; refer to a business-records skill
- User wants to declutter their home broadly (furniture, clothes, kitchen items, general possessions) -- use the `decluttering-method` skill instead
- User needs legal advice about whether a specific document is enforceable, what a clause means, or whether they need an attorney -- always direct them to qualified legal counsel; this skill covers logistics, not legal interpretation
- User is asking about records management in a healthcare, legal, or government professional context -- those domains carry regulatory mandates (HIPAA, state bar rules, federal records acts) beyond household scope

---

## Process

### Step 1: Assess the User's Current State and Scope

Before designing anything, understand exactly what the user is working with. Ask targeted questions to calibrate the output:

- **Volume:** One pile on a desk (under one box), multiple banker's boxes, or an entire room? One banker's box (approximately 2,500 sheets) takes 2-3 hours to sort; three boxes takes a full weekend.
- **Time range:** Does the paperwork span 1-2 years (manageable), 5-10 years (significant purging needed), or 20+ years (triage strategy required)?
- **Document types present:** Ask specifically about: tax returns, bank/investment statements, medical records and bills, insurance policies, legal documents (wills, deeds, contracts), warranties, vehicle records, pay stubs, receipts, and children's records. Users often forget categories until prompted.
- **Current infrastructure:** Does the user already own a filing cabinet, file boxes, or folders? Do they have a shredder? These determine setup cost and timeline.
- **Household composition:** Single adult, couple, children, elderly dependents? Each adds document categories and complexity.
- **Special circumstances:** Recent divorce, death of a family member, home sale or purchase, bankruptcy, or retirement? These generate unique document clusters that need special handling.
- **Physical-only or hybrid preference:** This skill covers physical paper. If the user wants to scan and go paperless for some categories, note that in the output and explain the critical-documents exception (originals of certain documents can never be replaced by a scan).

---

### Step 2: Explain the Three-Pile Triage Method for Accumulated Paper

If the user has any existing backlog of unsorted paper -- anything more than a week's worth of mail -- they must triage before they file. Filing directly into a new system without triage creates a disorganized system immediately.

- **Pile 1 -- ACTION REQUIRED:** Bills that may be unpaid, forms requiring a signature, legal notices with deadlines, correspondence requiring a response. This pile gets processed first, before any filing happens. Unpaid bills in a pile cost money; everything else can wait.
- **Pile 2 -- FILE:** Documents to retain for reference -- statements, records, filed tax returns, insurance documents, medical records, receipts for significant purchases.
- **Pile 3 -- SHRED OR RECYCLE:** Anything with personal information (account numbers, Social Security numbers, medical data, financial figures) goes to the shred pile. Anything without personal information (junk mail, catalogs, generic flyers) goes directly to recycling. Do not merge these two sub-piles.

**Triage rules to communicate to the user:**
- Do not read every document during triage. Scan for category only. Reading everything doubles the time.
- Do not make filing decisions during triage. The only decision is: action, file, or shred.
- Process the Action pile immediately after triage -- before setting up the filing system. Discover any overdue bills or missed deadlines now.
- Estimate timing honestly: one standard banker's box of mixed paper takes 2-3 hours to fully triage, file, and prepare for shredding. A decade of accumulated paperwork may require 3-5 dedicated sessions of 2-3 hours each.

---

### Step 3: Design the Filing Structure

A household filing system needs 8-12 top-level categories. Fewer than 8 creates overcrowded folders that are hard to search; more than 12 creates a system too complex to maintain. Complexity is the enemy of consistency -- every extra category is a decision point that slows the filing habit and causes avoidance.

**The ten universal household categories:**

1. **Tax Returns and Supporting Documents** -- Filed returns, W-2s, 1099s (all types), Schedule K-1s, charitable donation receipts, business expense receipts, home office documentation, energy credit receipts, medical expense receipts above the 7.5% AGI threshold
2. **Banking and Investments** -- Checking and savings statements, brokerage statements, retirement account statements (401k, IRA), certificates of deposit, year-end investment summaries, confirmation statements for stock purchases or sales (critical for calculating capital gains basis)
3. **Insurance Policies** -- Health (policy documents, Explanation of Benefits statements, flexible spending account records), auto, homeowners or renters, life, disability, umbrella liability, and long-term care policies
4. **Medical and Health Records** -- Doctor visit summaries, lab results, imaging reports, prescription histories, vaccination records, mental health records, dental and vision records, medical bills (both unpaid and paid-and-resolved)
5. **Housing and Property** -- Mortgage documents, property deed, property tax bills and payment confirmations, homeowner association documents, lease agreements (for renters), home improvement receipts (capital improvements specifically), appliance purchase receipts, utility account information
6. **Vehicles** -- Title for each vehicle, registration, loan documents, insurance (can cross-reference the Insurance category), maintenance logs, repair receipts, roadside assistance memberships
7. **Legal and Identity Documents** -- Will and any codicils, living will or advance healthcare directive, durable power of attorney, healthcare proxy designation, birth certificates, marriage certificate, divorce decree, adoption papers, naturalization certificate, Social Security cards, passports (copies -- originals in safe)
8. **Employment and Income** -- Current employment contract, benefits summary, pay stubs (current year only), professional licenses and certifications, pension or retirement plan summary plan descriptions, unemployment documents if applicable
9. **Warranties and Manuals** -- One folder per major appliance or category, with warranty card/document and purchase receipt attached inside the manual or in an envelope. Only keep items currently owned.
10. **Education and Children** -- School transcripts, immunization records, standardized test score reports, diplomas and degrees, professional certifications, extracurricular award documentation, 529 plan statements (can also file with Investments)

**Color coding (optional but significantly improves speed):**
Assign one color per category. When filing or searching, the color is visible before the label. Red for taxes, blue for financial/banking, green for medical, yellow for housing, orange for legal/identity. Studies in workplace filing efficiency consistently show color-coded systems are retrieved 25-30% faster than label-only systems.

**Within each category -- subcategory structure:**
- For time-sensitive categories (taxes, banking, medical bills): use year-labeled subcategory folders within the hanging folder. Label: "Taxes 2023", "Taxes 2022", etc.
- For entity-based categories (insurance, vehicle): use one folder per policy or vehicle.
- For permanent documents (legal, identity): no date subdivisions needed. These are single-folder categories.

---

### Step 4: Build the Retention Schedule

Every document type has a retention period derived from one of four sources: IRS audit windows, state statute of limitations for civil claims, lender or creditor dispute windows, and practical utility. When in doubt, the 7-year rule (matching the IRS maximum audit window for substantial understatement of income) covers most financial documents.

**Key retention principles to explain:**

- The IRS standard audit window is 3 years from the filing date (or due date, whichever is later). The extended window for substantial understatement of income (omitting more than 25% of gross income) is 6 years. There is no statute of limitations for fraudulent returns. The 7-year default provides a margin above the 6-year window.
- "Filing date" means the date you actually filed, not the tax year. A 2021 return filed April 15, 2022, starts its clock April 15, 2022. An extension-filed return starts its clock on the actual filing date.
- Capital gains basis records (confirmation statements for stock purchases, home improvement receipts that increase cost basis) must be kept until 7 years after the asset is sold -- not 7 years from purchase. A stock bought in 2005 and sold in 2024 needs its 2005 purchase confirmation until 2031.
- Medical bills must be kept long enough to resolve any insurance disputes and to document deductible expenses. Five years covers most dispute windows and aligns with state statute of limitations for contract disputes in most jurisdictions.

**Provide this retention schedule in the output:**

| Document Type | Retention Period | Rationale | After Period |
|---|---|---|---|
| Federal tax returns (the return itself) | 7 years from filing date | IRS extended audit window | Shred |
| W-2s, 1099s, and all tax supporting documents | 7 years from filing date of the return they support | Must accompany the return if audited | Shred |
| Charitable donation receipts ($250+, written acknowledgment required) | 7 years | Required documentation for deduction | Shred |
| Home improvement receipts (capital improvements) | While you own the property + 7 years after sale | Increases cost basis, affects capital gains tax | Shred |
| Brokerage/investment confirmation statements (buy/sell) | Until 7 years after the asset is sold | Establishes cost basis for capital gains calculation | Shred |
| Monthly bank statements (no tax relevance) | 1 year | Return window and dispute period | Shred |
| Monthly bank statements (year-end, with tax-relevant transactions) | 7 years | Part of tax record | Shred |
| Credit card statements (no tax-deductible purchases) | 1 year | Dispute window (Fair Credit Billing Act: 60 days, but disputes can arise later) | Shred |
| Credit card statements (with tax-deductible purchases) | 7 years | Supports tax documentation | Shred |
| Pay stubs | Current year only -- shred after reconciling with W-2 | W-2 supersedes pay stubs | Shred |
| Medical bills (paid, no dispute) | 5 years | State contract dispute statute of limitations | Shred |
| Explanation of Benefits (EOB) from health insurer | 5 years | Needed to dispute billing errors or reimbursement | Shred |
| Medical records (diagnosis, treatment, lab results) | Lifetime | Health history, second opinions, disability claims | Never discard |
| Vaccination records | Lifetime | School, travel, employment requirements | Never discard |
| Insurance policies (active) | Duration of policy + 3 years | Claims can be filed after a policy period ends | Shred |
| Insurance policies (expired, no pending claims) | 3 years after expiration | Dispute or late claim window | Shred |
| Auto and home insurance claim records | 7 years from claim resolution | Dispute, subrogation, or repeat-claim history | Shred |
| Utility bills (no tax relevance) | 1 year | Return window; annual cycle | Shred or recycle |
| Utility bills (home office deduction documented) | 7 years | Part of tax documentation | Shred |
| Mortgage statements (monthly) | 1 year | Reconciliation | Shred |
| Mortgage closing documents | While you own the property + 7 years | Part of property cost basis record | Shred |
| Property deed | Permanently | Proof of ownership | Never discard |
| Vehicle title | While you own vehicle + 3 years | Dispute, lien release verification | Shred after confirmed clear title transfer |
| Warranties | While you own the item | No value after item is gone | Recycle |
| Receipts for everyday purchases (no return need) | 30-60 days | Return window | Recycle |
| Receipts for major purchases ($200+) | Warranty period + 1 year | Insurance claims, extended warranty | Shred |
| Birth certificates | Permanently | Government-issued identity document | Never discard |
| Marriage certificate | Permanently | Required for name changes, benefits, estate | Never discard |
| Divorce decree | Permanently | Affects property rights, benefits, future legal matters | Never discard |
| Death certificates | Permanently | Estate settlement, benefits claims | Never discard |
| Social Security cards | Permanently | Identity verification | Never discard |
| Passports (expired) | Keep 1 expired passport | Backup identity document | Shred after one subsequent renewal |
| Will and trust documents | Permanently -- replace, never just discard | Superseded versions: shred after new version is signed | Never discard current version |
| Power of attorney | Duration of document + permanently if general/durable | Disputes can arise after death | Keep permanent |
| Advance healthcare directive / living will | Permanently | Medical emergencies require immediate access | Never discard |
| Military discharge papers (DD-214) | Permanently | Required for VA benefits, burial rights, veteran services | Never discard |
| Pension and retirement plan statements | Annual summaries: permanently; monthly statements: 1 year | Benefits disputes can arise decades later | Shred monthly after annual summary received |
| Adoption papers | Permanently | Identity, inheritance, medical history | Never discard |
| Naturalization certificate | Permanently | Proof of citizenship | Never discard |

---

### Step 5: Identify and Secure Critical Documents

Critical documents are those that are: (a) legally irreplaceable or extremely difficult to replace, (b) needed immediately in an emergency, or (c) foundational to identity, property rights, or estate. These documents must be stored separately from the main filing system in a secured, fireproof location.

**Two acceptable storage options for originals:**

1. **Fireproof home safe:** Must be rated for at least 1 hour at 1,700°F (the UL 350 rating, which protects paper). Do not confuse with a fireproof lockbox rated only for valuables -- look specifically for UL 350 or equivalent paper protection rating. Price range: $60-200 for a residential safe adequate for a household's critical documents. Bolt to a wall stud or floor joist if possible -- unsecured safes can be carried out in a burglary.

2. **Bank safe deposit box:** Highly secure from fire and theft. Limitation: inaccessible on bank holidays and outside business hours. Never store a will exclusively in a safe deposit box -- access may be restricted until after probate, creating a circular problem. Store a copy of the will in the safe deposit box and the original with the attorney or at home.

**What goes in the critical documents kit:**
- Birth certificates (all household members)
- Marriage certificate
- Divorce decree (if applicable)
- Adoption papers (if applicable)
- Social Security cards (all household members)
- Passports (when not traveling)
- Naturalization certificate (if applicable)
- Military discharge papers / DD-214 (if applicable)
- Property deed(s)
- Vehicle title(s)
- Will (current, signed version)
- Trust documents (if applicable)
- Durable power of attorney
- Healthcare proxy / advance directive
- Life insurance policy documents
- USB drive with encrypted digital scans of all of the above

**Digital backup protocol:**
Scan or photograph every document in the critical documents kit. Store encrypted copies in two separate locations: one on a USB drive in the safe, and one in a secure cloud storage service with strong password and two-factor authentication enabled. A digital copy cannot replace an original for most government purposes, but it dramatically speeds up reconstruction if originals are lost.

---

### Step 6: Establish the Incoming Paper Workflow

The filing system solves the historical backlog. The workflow prevents future accumulation. Without a processing habit, any filing system returns to piles within 60-90 days. The workflow must have three time horizons:

**The Daily Mail Sort (2 minutes maximum -- must be done at the mail point):**
The single most important habit. The key is to never set paper down without making a decision. Execute the sort standing at the recycling bin or trash:
- Obvious junk, catalogs, and advertisements: directly into recycling (do not open, do not bring inside)
- Action items (bills, forms, items requiring a response): into the Action Tray (a dedicated physical inbox on a desk or kitchen counter)
- File items (statements, notices, receipts to keep): into the To-File Folder (a second slot in the inbox)
- Truly uncertain items: a "Hold" slot, reviewed weekly -- if it's still uncertain after a week, it's likely junk

**The Weekly Processing Session (15-20 minutes, same day each week):**
Pick a consistent day -- Sunday evening works well before the new week begins:
1. Process every item in the Action Tray: pay bills, log into accounts to confirm autopayments, sign and return forms, schedule appointments, respond to correspondence
2. Move resolved action items to the To-File Folder
3. File everything in the To-File Folder into the correct category folder
4. The Action Tray and To-File Folder should be empty at the end of this session

**The Annual Purge (2 hours, each January before tax season):**
1. Gather last year's tax-relevant documents from all categories (W-2s, 1099s, deduction receipts, investment statements) and create a consolidated folder labeled by tax year for the upcoming filing
2. Identify documents in every category that have passed their retention period -- use the retention schedule
3. Create a shred pile of all expired documents. Shred in a session immediately after sorting (do not leave the shred pile sitting -- it becomes clutter and a security risk)
4. Update the critical documents kit: verify all documents are present, confirm any documents have been renewed (passports, for example), add newly acquired documents (new vehicle title, updated will)
5. Archive the oldest year of financial statements: if you keep 7 years of tax records, January of 2025 means 2017 documents are now eligible to be purged
6. Update insurance: file the new year's policy documents, shred expired policies older than 3 years

---

### Step 7: Communicate Supplies Needed and Setup Costs

Give the user a concrete, cost-ranged shopping list so they can execute immediately:

**Minimum viable setup:**
- Hanging file folders (at least 10-12) -- look for reinforced-tab versions, not the cheapest available; weak tabs cause folders to sag and merge. Cost: $8-15 for a box of 25.
- Interior manila folders for subcategories (one box of 100) -- Cost: $5-10
- A file drawer, desktop file box, or rolling file cart -- not a cardboard box, which collapses. Cost: $0 (repurpose an existing drawer) to $40-60 for a new file box or cart.
- Adhesive folder labels or a basic label maker -- Cost: $0-20
- A cross-cut shredder -- do not use a strip-cut shredder; strip-cut documents can be reassembled. Cross-cut produces confetti-sized pieces. A household cross-cut shredder that handles 6-8 sheets per pass is sufficient. Cost: $30-60.
- An "Action" inbox tray for incoming paper requiring attention -- Cost: $8-15
- A fireproof safe rated UL 350 for paper protection -- Cost: $60-150 for residential models

**Optional upgrades:**
- Color-coded hanging folders (pre-sorted by color) -- Cost: $12-20 for a pack with multiple colors
- A dedicated filing cabinet (2-drawer lateral is more space-efficient than 2-drawer vertical for household volume) -- Cost: $80-200 new, $20-50 at office liquidation sales

**Total first-time setup cost:** $111-270 including a new shredder and safe. If the user already owns a shredder and has filing infrastructure, cost drops to $20-50 for folders and labels only.

---

## Output Format

When responding to a user, deliver the filing system in this structure. Adapt category list and retention schedule based on the user's stated household composition and document types:

```
## Your Household Filing System

### Phase 1: Initial Triage
[Triage instructions calibrated to user's volume estimate]

### Filing Structure

| # | Category | Color Code | What Goes In It | Retention Period |
|---|----------|-----------|-----------------|-----------------|
| 1 | Tax Returns & Supporting Docs | Red | [specific doc list] | 7 years from filing date |
| 2 | Banking & Investments | Blue | [specific doc list] | Varies: 1-7 years |
| 3 | Insurance | Green | [specific doc list] | Policy term + 3 years |
| 4 | Medical & Health | Green (lighter) | [specific doc list] | 5 years (records: lifetime) |
| 5 | Housing / Property | Yellow | [specific doc list] | While owned + 7 years |
| 6 | Vehicles | Yellow (lighter) | [specific doc list] | While owned + 3 years |
| 7 | Legal & Identity | Orange | [specific doc list] | Permanently |
| 8 | Employment | Blue (lighter) | [specific doc list] | Varies: 1 year to permanent |
| 9 | Warranties & Manuals | White | [specific doc list] | While you own the item |
| 10 | [Household-specific category] | [Color] | [specific doc list] | [Retention] |

### Retention Schedule
| Document Type | Keep For | Rationale | After Period |
|---------------|----------|-----------|--------------|
| [All relevant types for this user] | [specific duration] | [one-line reason] | Shred/Recycle/Keep |

### Critical Documents Kit (Fireproof Safe -- UL 350 Rated)
Items to store in a fireproof safe or bank safe deposit box:
- [ ] [Relevant items for this household]
- [ ] USB drive with encrypted scans of all of the above

### Incoming Paper Workflow

**Daily -- The Mail Sort (2 minutes, at the mailbox or door):**
- [specific 3-action decision tree]

**Weekly -- Processing Session ([Day of week], 15-20 minutes):**
1. [specific steps]

**Annual -- The Purge (January, 2 hours):**
1. [specific steps with document types to pull]

### Supplies Checklist
- [ ] [Item]: [cost estimate]
[Full supplies list with realistic cost ranges]

**Estimated setup time:** [calibrated to user's volume]
**Estimated cost:** [range based on what user already owns]
```

---

## Rules

1. **Always provide specific retention periods -- never say "keep for a few years."** Every document type has a defensible retention period based on IRS audit windows, state civil statutes of limitations, or practical utility. Vague guidance causes users to either keep everything forever (defeating the system) or shred things they need.

2. **The 7-year tax rule applies to supporting documents, not just the returns themselves.** A user who keeps their 1040 but shreds the supporting W-2s, receipts, and statements has kept useless paper. The return without its documentation is not defensible in an audit. Supporting documents and the return travel together for 7 years.

3. **Capital gains basis records follow the asset, not the calendar year.** A stock confirmation statement from 15 years ago must be kept until 7 years after the stock is sold. Home improvement receipts must be kept until 7 years after the home is sold. Failing to communicate this causes users to shred records they will desperately need at the time of sale.

4. **Never recommend shredding original legal identity documents, even when they appear outdated.** An expired passport, an old Social Security card, an obsolete will -- all of these require explicit confirmation before destruction. The expired passport can serve as a backup identity document. The old will should be shredded only after the user confirms the new version has been signed, witnessed, and notarized.

5. **A cross-cut shredder is the minimum -- strip-cut shredders are inadequate.** Strip-cut shredders produce long vertical strips that have been successfully reassembled by identity thieves. Cross-cut produces small rectangular pieces. Micro-cut produces even smaller pieces and is appropriate for the highest-sensitivity documents (tax returns, medical records, legal documents). If a user mentions they have a strip-cut shredder, recommend upgrading.

6. **The incoming paper workflow is the system's most critical component -- spend proportional time on it.** A perfectly organized filing system fails within 90 days without a consistent processing habit. A mediocre filing system with a strong daily sort habit stays functional indefinitely. Always deliver both the structure and the workflow; never deliver only the structure.

7. **Never store the original will exclusively in a bank safe deposit box.** Most states restrict access to a safe deposit box after the owner's death until probate is opened -- but opening probate requires the will. This creates a catch-22. The will's original should be stored either with the estate attorney or in a home fireproof safe, with a copy in the safe deposit box.

8. **When a household has experienced a recent death, pause system-building until critical estate documents are identified.** Bereaved users should identify death certificates (obtain at least 10-15 certified copies from the vital records office -- not photocopies), locate the will, and identify any immediately needed account information before organizing. Estate document triage has different urgency than routine organization.

9. **Recommend purging the shred pile in the same session as sorting.** Leaving a shred pile sitting creates re-accumulation risk and is a security hazard. If the user does not own a shredder, recommend a bank shredding event (many banks offer free periodic shredding for customers) or a certified shredding service for large volumes -- typically $1-3 per pound.

10. **Do not conflate medical records with medical bills.** Medical records (diagnoses, lab results, imaging, treatment histories) should be kept for a lifetime and never purged -- a patient's medical history is clinically relevant indefinitely and required for disability claims, second opinions, and new provider onboarding. Medical bills (the financial transaction) follow the 5-year retention schedule. Users frequently shred one when they mean to shred the other.

---

## Edge Cases

### User Has 10+ Years of Accumulated, Completely Unsorted Paper

Do not attempt to build a filing system first. The triage must happen before any structure is established. Recommend the following approach:

- **Session 1 (2-3 hours):** Sort everything into four physical piles only: Action, File, Shred, and Uncertain. Label each pile with a sticky note. Do not sub-sort within piles.
- **Session 2 (1-2 hours):** Process the Action pile. Pay anything overdue, call about anything time-sensitive, sign and send forms.
- **Session 3 (1-2 hours):** Sort the File pile into rough categories -- not individual folders yet, just category groupings. At this stage, a rubber band or paper clip holding "tax documents" together is sufficient.
- **Sessions 4+:** Set up the actual filing system, then file category piles into it one category at a time.
- **Realistic timeline:** A decade of household paperwork filling 4-6 banker's boxes requires approximately 10-15 hours of total work across multiple sessions. Trying to do it in one session produces frustration and abandonment.
- The "Uncertain" pile is reviewed last. After seeing the full scope of the collection, many items that seemed uncertain earlier become obvious.

### User Is a Renter (No Property Ownership Documents)

Remove the housing ownership sub-categories and replace with rental-specific content:

- **Lease and Rental folder contents:** Current signed lease with all addenda, move-in inspection report, move-in photographs (date-stamped), security deposit receipt and amount, all written correspondence with landlord or property management, maintenance request records (including dates and confirmations), receipts for any renter-paid repairs or improvements.
- **Retention after moving out:** Keep all rental documents for 3 years after vacating. Security deposit disputes have a statute of limitations in most states of 1-3 years. Maintenance records protect against claims of damage caused before tenancy.
- **Move-in photographs are critical:** Recommend the user take date-stamped photographs of every room, appliance, wall, and floor at move-in and file them immediately. These photographs, stored digitally and referenced in the rental file, are the most powerful defense against wrongful security deposit withholding.
- **Renter's insurance EOB records** follow the same 3-year-after-expiration rule as homeowner's insurance.

### Recently Bereaved User Managing a Deceased Person's Paperwork

This situation has time urgency and emotional complexity. Approach it carefully:

- **Immediate priority (first 30 days):** Locate the will, locate life insurance policies, locate any trust documents, and obtain certified death certificates (at least 10-15 from the vital records office -- not photocopies; each financial institution will require an original certified copy for asset transfers).
- **Documents to preserve through estate settlement (do not purge anything):** The last 3 years of federal and state tax returns, all bank and investment account statements, all life insurance policies, property deeds and vehicle titles, outstanding loan documents and credit card statements (debts of the estate), pension or annuity documents, any business ownership documents.
- **After estate is fully settled:** Keep the final estate accounting document permanently. Keep the last 7 years of the deceased person's tax returns in case of IRS inquiry (estates can be audited).
- **Specifically note:** Many financial institutions will not accept a photocopy of a death certificate. Obtaining additional certified copies from the vital records office after the fact is possible but slow. Urge the user to request more copies than they think they need at the time of issuance.
- Always direct the user to work with the estate attorney for state-specific document requirements and probate procedures.

### User Wants to Go Fully Digital (Scan and Shred Everything)

Honor the preference but communicate the critical exception clearly:

- **Documents that can be scanned and shredded:** Bank statements, credit card statements, utility bills, pay stubs (after W-2 reconciliation), medical bills (paid), insurance Explanation of Benefits statements, receipts for everyday purchases, warranty documents (manufacturer warranties are increasingly verified by serial number, not paper card).
- **Documents that must retain physical originals permanently:** Birth certificates, marriage certificates, divorce decrees, death certificates, Social Security cards, naturalization certificates, military discharge papers (DD-214), property deeds, vehicle titles, wills, trust documents, powers of attorney, adoption papers, and professional licenses that exist only as physical certificates. A digital scan of a birth certificate is useful as a reference but is not accepted as proof of identity by government agencies, courts, or most financial institutions.
- **Recommended scanning tools:** A dedicated document scanner produces better results than a smartphone camera app, but smartphone apps with perspective correction (the document is photographed at an angle and the app corrects it to a flat view) produce acceptable results for most documents. File scans as PDFs, not JPEGs -- PDFs preserve text searchability, maintain consistent file size, and are more widely accepted.
- **Digital filing structure:** Mirror the physical category structure exactly. Use the same 10 category names as folders on the computer or cloud storage. Within each, use year-labeled subfolders for time-sensitive categories.

### Household Contains Children's Records (School-Age Children or Young Adults)

Add a dedicated Children's Records category or a child-named folder within the Medical/Education categories:

- **What to keep permanently for each child:** Immunization records (required for school enrollment at every level, travel, some employment, and military service), Social Security card, birth certificate (in the critical documents kit), adoption papers if applicable.
- **What to keep until education is complete:** School transcripts and report cards -- keep cumulative records through secondary school, then once a final high school transcript is obtained, individual grade-level records are redundant. Keep the final official transcript permanently after it is issued.
- **Standardized test scores (SAT, ACT, AP, IB):** Keep until the student has been enrolled in their final degree program. College applications may require them for advanced placement or credit transfer. After enrollment is confirmed, shred.
- **Extracurricular certificates, awards, honor roll:** These have no legal or financial value. Keep or discard based on sentimental preference -- but be explicit that they are not retention-required documents so the user can make an informed choice rather than keeping everything "just in case."
- **Children's medical records:** Follow the lifetime retention rule. As children become adults, transfer custody of their medical records to them or ensure they have access.

### User Shares a Household with a Partner (Merging Two Filing Systems)

Merging two adults' filing systems requires decisions about joint vs. individual folders:

- **Joint documents** (both names appear): joint tax returns, mortgage or lease, joint bank accounts, shared insurance policies. File once in the shared system.
- **Individual documents** (one name only): individual retirement accounts, individual medical records, previous employer records, documents from before the relationship. File in a personal subfolder within each category, or use a divider within the shared folder.
- **Wills and estate documents are particularly critical:** Each person's will, power of attorney, and healthcare directive must be individually filed and individually accessible. Cross-reference each other's critical documents locations.
- **If the relationship ends:** Each person should maintain copies of all jointly filed documents, particularly tax returns, mortgage documents, and records that affect both individuals' financial history.

### User Has High-Value Items Requiring Insurance Documentation

Users with fine art, jewelry, collectibles, antiques, or high-value electronics need a supplemental folder:

- **What to file:** Appraisal documents (must be updated every 3-5 years for insurance purposes -- values fluctuate), purchase receipts, photographs of each item with visible identifying features, insurance riders or scheduled personal property endorsements (these are separate from standard homeowner's policy), and provenance documents for art or antiques.
- **Retention:** Keep all appraisals and photographs while you own the item plus 7 years (insurance claims can be filed years after a loss is discovered). Keep the most recent appraisal for insurance renewal purposes.
- **Storage:** Keep a copy of all appraisals and photographs in a location separate from the home -- the home safe is appropriate for documents, but the photographs should also be stored digitally off-site. If the home burns down and the jewelry burns with it, the insurance claim requires proof the items existed and their value.

---

## Example

**Input:** "I've been stuffing papers into a kitchen drawer for three years -- mostly bank statements, medical bills, some tax stuff from my accountant, a few warranties, and random receipts. My husband and I both work. We rent our apartment. We have a 7-year-old. I want to actually get this under control."

**Output:**

---

## Your Household Filing System

### Phase 1: Initial Triage (Do This Before Setting Up Any Folders)

Your kitchen drawer situation is completely solvable. Before buying anything or setting up folders, spend one 90-minute session doing a rough sort. Dump everything onto a table. Create four piles:

1. **ACTION REQUIRED** -- any bill that might be unpaid, any form needing a signature, any medical bill you are not sure is resolved
2. **FILE** -- statements you have received and processed, tax documents, medical records, receipts to keep
3. **SHRED** -- anything with your name, account numbers, Social Security numbers, medical information, or financial figures that you no longer need
4. **UNCERTAIN** -- anything you cannot categorize in under 5 seconds

After sorting: Process the Action pile first. Then set up the system below. Then file. Then shred. Do not leave the shred pile sitting -- process it the same day.

**Realistic time estimate:** Three years of a kitchen drawer, two adults, one child -- approximately 3-4 hours total across two sessions.

---

### Filing Structure

| # | Category | Folder Color | What Goes Here | Retention |
|---|----------|-------------|----------------|-----------|
| 1 | Tax Returns & Supporting Docs | Red | Filed 1040s, W-2s from both jobs, any 1099s, charitable donation receipts, medical expense receipts over 7.5% AGI threshold, accountant correspondence | 7 years from filing date |
| 2 | Banking & Investments | Blue | Checking and savings statements (both of yours), any retirement account statements (401k, IRA), year-end summaries | Bank statements: 1 year unless tax-relevant (then 7 years); retirement: annual summaries permanently |
| 3 | Insurance | Green | Health insurance policy documents and ID cards, renters insurance policy, auto insurance (if you have a car), any life or disability policies | Active policy + 3 years after expiration |
| 4 | Medical & Health | Light Green | Medical visit summaries, lab results, paid medical bills, Explanation of Benefits from your health insurer, your daughter's medical records (separate subfolder) | Bills: 5 years; medical records: lifetime; EOBs: 5 years |
| 5 | Lease & Rental | Yellow | Current signed lease (all pages and addenda), move-in inspection report, any move-in photographs, security deposit receipt ($[amount] paid on [date]), written landlord communications, maintenance requests and confirmations | All rental documents: 3 years after you move out |
| 6 | Employment | Blue-Gray | Current employment contracts or offer letters for both of you, benefits summary plan descriptions, professional licenses or certifications, pay stubs (current year only -- shred previous years after reconciling with W-2) | Pay stubs: current year only; contracts: 3 years after employment ends |
| 7 | Warranties & Manuals | White | Warranties and purchase receipts for major items (grouped by appliance or device) | While you own the item; then recycle |
| 8 | Legal & Identity | Orange | Birth certificates (yours, your husband's, your daughter's), marriage certificate, Social Security cards (copies -- originals in safe), passports when not traveling | Permanently -- originals in fireproof safe |
| 9 | Children's Records | Purple | Daughter's immunization records, school enrollment documents, pediatric medical records (can also keep in Medical folder), report cards, standardized test scores | Immunization records: permanently; report cards: keep through high school graduation, then only final official transcript |
| 10 | Receipts & Warranties -- Miscellaneous | White | Receipts for purchases over $100 (appliances, electronics, furniture), product warranties without a dedicated manual | Warranty period + 1 year; then shred or recycle |

---

### Retention Schedule (Your Household)

| Document Type | Keep For | Why | After Period |
|---|---|---|---|
| Tax returns (the filed 1040) | 7 years from filing date | IRS audit window | Shred |
| W-2s and all tax supporting docs | 7 years (must travel with the return) | Required for audit defense | Shred |
| Bank statements -- no tax-relevant transactions | 1 year | Dispute window | Shred |
| Bank statements -- year with tax-relevant transactions | 7 years | Part of tax record | Shred |
| Pay stubs | Current year only | Verify against W-2, then shred | Shred |
| Medical bills (paid, resolved) | 5 years | Insurance dispute and contract dispute window | Shred |
| Explanation of Benefits (EOBs) | 5 years | Billing error dispute | Shred |
| Medical records (diagnoses, lab results, treatment) | Lifetime | Health history is never obsolete | Never shred |
| Daughter's immunization records | Permanently | School, college, travel, employment | Never shred |
| Health insurance policy (active) | Duration + 3 years | Late claims window | Shred |
| Renters insurance policy (active) | Duration + 3 years | Claim disputes | Shred |
| Lease (current) | Full term + 3 years after move-out | Security deposit disputes | Shred |
| Move-in photos and inspection report | 3 years after move-out | Security deposit protection | Shred |
| Employment contracts (current) | Duration of employment + 3 years | Dispute, reference | Shred |
| Receipts for everyday purchases | 30-60 days | Return window | Recycle |
| Receipts for purchases over $100 | Warranty period + 1 year | Insurance, extended warranty | Shred |
| Warranties | While you own the item | No value after | Recycle |
| Birth certificates (all three) | Permanently | Government identity | Never shred |
| Marriage certificate | Permanently | Benefits, estate, legal | Never shred |
| Social Security cards | Permanently | Identity verification | Never shred |

---

### Critical Documents Kit (Fireproof Safe)

Purchase a fireproof home safe with a UL 350 paper rating. Residential models run $60-150 and are adequate for a household's critical documents. If you live in a building where storing a safe is impractical, a bank safe deposit box works for everything except your will (see note below).

**Confirm you have these documents and store originals here:**
- [ ] Your birth certificate
- [ ] Your husband's birth certificate
- [ ] Your daughter's birth certificate
- [ ] Your marriage certificate
- [ ] All three Social Security cards
- [ ] Passports for all family members (when not in use)
- [ ] Your daughter's immunization records (or keep a certified copy here; original in the Children's Records folder)
- [ ] Current will(s) -- if you do not have a will, this is a strong reason to create one; as parents of a minor, this is urgent
- [ ] Any power of attorney or healthcare directive documents
- [ ] USB drive with encrypted scans of everything above

**Note on the will:** Do not store the will's only original in a bank safe deposit box. Access to the box may be restricted after death, which is exactly when the will is needed. Store the original at home in the fireproof safe, and give a copy to your estate attorney.

---

### Incoming Paper Workflow

**Daily -- The Mail Sort (2 minutes, at the door or mail slot):**

Stand at the recycling bin. Make only three decisions:
1. **Junk mail, catalogs, advertisements:** Directly into recycling -- do not bring them to the counter
2. **Action items** (a bill, a form, something from the school, your daughter's medical appointment reminder, your insurer): Into the Action Tray on your counter or desk
3. **File items** (a bank statement, an EOB, a pay stub, a warranty card): Into the To-File Folder

This habit works because it takes less time than setting paper down "for later." Paper set down "for later" becomes the pile.

**Weekly -- Processing Session (Sunday evening, 15-20 minutes):**
1. Open the Action Tray. Pay any bills (or confirm autopay ran), respond to any forms, schedule any appointments
2. Note: medical bills require extra attention -- compare every bill against the corresponding EOB from your insurer before paying. Billing errors are common; the EOB shows what your insurer has determined you actually owe.
3. Move resolved items to the To-File Folder
4. File everything in the To-File Folder into the correct category folder
5. Both trays should be empty by the end of the session

**Annual -- The Purge (January, 2 hours):**
1. Pull all tax-supporting documents from the current year: W-2s from both employers, any 1099s, donation receipts, relevant medical receipts. Place them in a folder labeled "Taxes [year] -- TO FILE." Your accountant gets this folder.
2. After you file taxes, relabel the folder "Taxes [year] -- FILED" with the filing date noted inside
3. Shred any documents that have hit their retention limit (check the retention schedule above)
4. Shred last year's pay stubs after confirming they match your W-2s
5. Update insurance: file this year's policy documents, shred any policies expired more than 3 years ago
6. Verify the critical documents kit: confirm all documents are present and current

---

### Supplies Checklist

- [ ] Hanging file folders, 25-count box, assorted or color-coded: $8-15
- [ ] Manila interior folders for subcategories, 100-count: $5-10
- [ ] Small filing cabinet, 2-drawer lateral (fits more than vertical) or a desktop file box: $0-60 (check if you have a repurposable drawer first)
- [ ] Label maker or adhesive folder labels: $0-20
- [ ] Cross-cut shredder (do not use strip-cut): $35-60
- [ ] Action Tray and To-File Folder for the counter or desk: $10-20
- [ ] Fireproof safe, UL 350 paper-rated: $60-150
- [ ] USB drive for encrypted digital backup: $10-15

**Estimated total:** $128-350 depending on what you already own. If you already have a shredder, deduct $35-60. If you have an existing filing cabinet or drawer, deduct $30-60.

**Estimated setup time:** 3-4 hours for the initial triage and filing of the accumulated kitchen drawer backlog, plus 1 hour to purchase supplies and label folders. After setup, the daily sort takes 2 minutes and the weekly session takes 15-20 minutes. Annual purge: 2 hours each January.

---

**One final note:** The most important thing you will do in this project is not the filing -- it is establishing the daily mail sort habit. If paper never sits undecided for more than 24 hours, it never becomes a pile. The system you build handles everything that has accumulated. The habit prevents it from accumulating again.
