This is a question that is asked hundreds of times each tax season, ” How long do I have to keep my tax records for?”
Generally, 3 years from the date you filed the return.
Tax records such as receipts, bills, canceled checks, and other documents that support an item of income, expenses or a deduction appearing on a return should be kept until the period of limitation expires for that return. For assessment of tax you owe . Returns filed before the due date are treated as filed on the due date.
There are no periods of limitations to assess tax when a return is fraudulent or when no return is filed.
If income that you should have reported is not reported, and it is more than 25% of the gross income shown on the return, the time to assess is 6 years from when the return is filed. For filing a claim for credit or refund, the period to make the claim generally is 3 years from the date the original return was filed, or 2 years from the date the tax was paid, whichever is later.
For filing a claim for a loss from worthless securities the time to make the claim is 7 years from when the return was due.
For employers, you must keep all your employment tax records for at least 4 years after the tax becomes due or is paid, whichever is later.
For businesses, there is no particular method of bookkeeping you must use. However, you must use a method that clearly and accurately reflects your gross income and expenses. The records should substantiate both your income and expenses. Publication 583, Starting a Business and Keeping Records, and Publication 463, Travel, Entertainment, Gift, and Car Expenses, provide additional information on required documentation for taxpayers with business expenses. Publication 552, Record keeping for Individuals, provides more information on record keeping requirements for individuals.
Keep well organized tax records and you will never have a problem. There are many tax organizers available to do this. Another thought is to scan all your records into your computer with a good back up control.