topic Re: Tax returns in Community Chat

Tax returns

gidgetgh — Fri, 04 Feb 2022 14:05:10 GMT

Time for our yearly question. How long do you keep your tax returns?

My accountant files electronically but gives me a copy of the Federal and State returns and I have all my 1099's, charity receipts and all that.

My husband and I always kept 7 years (ok, let me rephrase that- he would have kept them till the end of time, but we kept 7 years).

Since it's time to file for 2021, this is the time I would shred our oldest return. And I am always just a little bit hesitant until the shredding is done and then I never think about it again.

So, how long do you keep your returns and all the backup?

Re: Tax returns

RespectLife — Fri, 04 Feb 2022 14:47:07 GMT

@gidgetgh

Same as you, 7 years.

Our CPA at work still sticks to that for our company...and tells me continue with the 7 yr rule.

Re: Tax returns

Janey2 — Fri, 04 Feb 2022 15:21:29 GMT

The IRS could ask to see tax returns going back 3 years unless they can prove fraud and they can ask for 6 years back.

Re: Tax returns

gizmogal — Fri, 04 Feb 2022 15:23:50 GMT

I keep my tax fiings 7 years. I file electronically using TurboTax and I keep a full paper copy of both Federal and State and a PDF copy. All supporting documents stay in the envelope with the tax forms.

I shred all the paper tax records of the 8th year previous, so I've just shredded 2013. Keeping the PDF copies takes up no space other than in my hard drive, so I do still have records of older tax year filings. But I find no need to keep further back than 7 years of paper.

Here is a quote from the IRS website FAQ.

Q: Can the IRS audit you after 7 years?

IRS: Generally, the IRS can include returns filed within the last three years in an audit. If we identify a substantial error, we may add additional years. We usually don't go back more than the last six years.

Hope I've helped.

Re: Tax returns

beckyb1012 — Fri, 04 Feb 2022 15:30:44 GMT

I actually have all of mine dating back to 2000. I divorced in 1999 and there is just something special about having all those in my name only after dumping that low-life. I am just sentimental that way. But 7 years is the correct time frame.

Re: Tax returns

millieshops — Fri, 04 Feb 2022 15:58:51 GMT

@gidgetgh 7 years- I had more until I did a second major downsizing 2 years back.

Just earlier today, I organized my tax files. As soon as I can file the currently due form, I will sit with the file from 8 years ago and make certain it conta8ns nothing I want or need to be reminded of.

Re: Tax returns

patbz — Fri, 04 Feb 2022 16:17:40 GMT

My Dad passed in 1999; when we were cleaning out his home we found tax returns going back to 1948! He was an electrical engineer for the Government and always went by the book and covered himself in paperwork. When my parents first retired my Mom, A teacher, was the one who had earned S.S.was not allowed to include my Dad as her dependent ( as a Fed.government employee under CSRS he never paid into S.S). 15 years later the Government changed that rule and he was allowed 1/2 her S.S. and years of back payments as well. He was so sure that this was an error that he put all of his SS in a separate account ( they'd realize their error and want it all back with interest) and never touched it for 23 years, until he passed. It was over $200,000 when he passed!

Re: Tax returns

drizzellla — Fri, 04 Feb 2022 16:21:02 GMT

I always thought you were safe by keeping returns for 7 years.

BUT I found out that that doesn't always work out. My Dad was Administrator for his Uncle's will. My Dad's Uncle was a sucessful engineer and he invested well. When he and his wife retired they lived in Vienna for 7 years and the United States for 7 years. They traveled by taking cruises. His wife died.

On one cruise he and his wife had met a woman. She liked how comfortablely my Dad's Uncle lived. Turns out my Dad's Uncle got cancer. She flew to the United States and took him to Switerland for a "Special treatment". While he was treated in Switerland she had him sign a 5 line will. His wife's name was misspelled. And witnessed by a TV repairman.

My Dad's Uncle's original will had a Bank as a Trustee, my Dad as Administrator and his Law Firm handling a 28 page will.

So a legal battle insued for years. With many law firms and banks.

Finally The Philadelphia Orphans Court ruled in her favor.

Twenty three years later (after my Dad had died) I received a letter from the Treasury Department. After all the years of legal mess, the money value of the estate was incorrectly calculated and there was money to be distributed. They wanted me to give them the information about the lady who sued the family for my Dad's Uncle estate.

I had no informtion about her at that time. And the Trustee bank had merged with other banks many years before. Besides I didn't want "that woman" to get another penny. I told the lady at the Department of Treasury to keep the money.

Re: Tax returns

Mz iMac — Fri, 04 Feb 2022 16:32:36 GMT

I shred mine every 4 yrs. I do my own.

Re: Tax returns

zitawins — Fri, 04 Feb 2022 16:41:35 GMT

I checked with my accountant recently and he told me to keep four years' back. I am being a little paranoid and am keeping five years' worth.

The rest I am shredding. They go back 20 years.

Re: Tax returns

Sooner — Fri, 04 Feb 2022 16:55:29 GMT

@drizzellla Now that's a story!!! WOW!

Re: Tax returns

drizzellla — Fri, 04 Feb 2022 17:29:29 GMT

@Sooner wrote:
@drizzellla Now that's a story!!! WOW!

My poor Dad. He had to take many many days off of work to meet with the Lawyers and the Bank over the years. Then he spent nights writing letters and making phone calls. The orginal will was supposed to be divided between his Uncle's brothers and sisters and their families. There were 16 brothers and sisters. So my Dad was the one who tried to be looking after their best interests.

Re: Tax returns

gertrudecloset — Fri, 04 Feb 2022 19:14:40 GMT

I used to keep seven years. However, here is the guidance from the IRS about Federal Tax Returns. State tax returns (if you're required to file one) may differ.

Period of Limitations that apply to income tax returns

Keep records for 3 years if situations (4), (5), and (6) below do not apply to you.
Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return.
Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction.
Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.
Keep records indefinitely if you do not file a return.
Keep records indefinitely if you file a fraudulent return.
Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

The following questions should be applied to each record as you decide whether to keep a document or throw it away.

https://www.irs.gov/businesses/small-businesses-self-employed/how-long-should-i-keep-records

Re: Tax returns

ladyann45 — Fri, 04 Feb 2022 19:28:53 GMT

I hope you have a hard copy somewhere because the rule with the IRS is 7 years.

Re: Tax returns

Puppy Lips — Fri, 04 Feb 2022 19:31:17 GMT

@gidgetgh I am with your husband. I have them all, every single year. I used to work a job where I had to review tax returns, credit reports, etc. That grilled it into my head to keep everything, although I would have anyway, as that seems to be in my DNA.

Re: Tax returns

bonnielu — Fri, 04 Feb 2022 20:03:19 GMT

I have mine since 1966 when we were married.