It is a common question how long to keep your tax records. But more importantly today you need to worry about keeping your records safe. Most of us usually store old records in boxes in the garage, but what if your house or garage is broken into. All of your information is ripe for the taking. I know it is costly, but people should think about having a separate storage unit or in today’s times you can store your documents on a backup drive or in the cloud. As we are finding out the cloud is not fail safe either so in my opinion I would opt for the backup drive.
Good news is you don’t have to keep records dating back to your birth. For tax documents 5 or 6 years are enough because statute of limitations for audit by IRS is 3 years and most states are 4 years. If you have an asset that is your home or income property you want to keep records for as long as you own it.
Be sure before destroying old tax returns, you confirm with the social security administration that they gave you proper credit for your earnings. Errors happen more often than you may think. Every few years you should be sure you get a statement of earnings from the administration and check earnings amounts. If you find an error, you can report it to them, but be sure to send copies of W-2’s and supporting documents. If you destroy them before checking, doubtful they will give you credit. If you do destroy a tax return you may later need, you can always request a copy from the IRS by filing form 4506.
Good luck and keep your records safe.