Quote Originally Posted by Boylston View Post
Treat them like any other item (mostly). If there's an upgrade, then retire them and put them away for safekeeping.

You might want to consider hanging on to some lvl 187-200 items even if they're not an upgrade. If I remember correctly, the new LFDungeon system takes iLvl into account and I think the heirlooms are still counting as iLvl 1 items for that purpose. (They may have changed that, however).
It must have been changed. My newest team is still using heirloom weapons and shoulders, the LFDungeon system after upgrading several other items now lets them into Random Heroic Dungeons.