- You should keep copies of tax returns and related documents for at least three years and up to seven years.
- Past tax returns help you file your current return and complete a mortgage or college financial aid application.
- You can request copies of tax returns from the last six years on the IRS website.
- This article was reviewed for accuracy and clarity by Lisa Niser, a member of Personal Finance Insider’s tax review board.
- See Personal Finance Insider’s picks for the best tax software »
You don’t have to save your tax returns forever, but it’s smart to keep them on hand for a few years.
The rule of thumb is to keep tax returns you’ve filed for the later of three years from when the original return was filed or, if you file an amended return after the original return has been processed, two years from when the tax was paid — this is how long the IRS has to question or audit you.
In general, you should keep filed tax returns and documents used to prepare them for at least three years.
Even if you submitted your returns prior to the April 15 due date, they are considered filed on the deadline, so that’s when the clock starts. After April 15, 2021, you can dispose of returns from 2017.
Even if you aren’t audited, it’s still smart to keep your tax returns. You’ll need information from them when completing a mortgage application or the Free Application for Federal Student Aid (FAFSA) form. You may also need your adjusted gross income (AGI) from last year’s tax return to verify your identity when filing this year’s return.
If you file with the same tax software each year, it will store your completed returns. However, you should still download and keep a copy under lock-and-key or password protected. Your return has sensitive information that fraudsters can use to assume your identity.
The IRS also recommends storing the documents used to prepare your tax return, including W-2s and 1099s, as well as any investment and bank statements, receipts for business expenses, health insurance records, and documentation of employer-provided coverage and premiums paid.
Some tax situations require keeping records for up to 7 years
For those with more complicated tax returns, many accountants suggest holding on to tax returns for six years, due to the IRS’ statute of limitations for underreported income. Under this rule, the IRS extends the time they have to question or audit you to six years when there is a substantial omission of income, defined as 25% or more of the taxpayer’s gross income on the return.
The IRS recommends keeping tax documents related to real estate for up to seven years after selling the property. Documents claiming a worthless securities loss or bad debt deduction should also be saved for seven years after you file your tax return.
If you misplace or accidentally throw out old tax returns, you can request a copy from the last six years from the IRS by filing out Form 4506 and mailing it in. The fee per copy is $50 and it could take up to 75 days to arrive.
If you don’t need the actual return, tax transcripts are free and available online in five to 10 days for the current tax year and usually the previous three years. A tax return transcript will show most line items, including your AGI and any additional forms or schedules filed, but won’t show any changes or amendments made to the original return. Other transcripts, such as the wage and income transcript and tax account transcript, can provide tax information from the past 10 years.
If and when you dispose of old tax returns, make sure to properly shred the documents to protect against identity theft.
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