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How Long Should You Keep Tax Papers?
Hooray, you’ve filed your taxes and now you’re wondering what to do with all those supporting documents you gathered?
Well, the good news is that you don’t need to hold onto them forever. In fact, you only need to keep tax papers for a certain amount of time in case of an audit or mistake.
If you’re an individual, Nerd Wallet has some easy-to-follow guidelines on what documents to keep and for how long.
And if you’re a small business or self-employed, the IRS has official guidelines you can refer to.
You might be surprised to find that THREE years is the length of time recommended to keep documents in almost all circumstances. And in just a few cases, SEVEN years is the very longest supporting documents need to be held onto.
(Ironically they say you should keep your papers longer IF you file a fraudulent return or don’t file at all. But I doubt those people are really worried about document retention!)😂
Since you are not a criminal and only 0.38% of returns are audited, chances are you’ll never need to look at them again. So, I recommend you don’t invest too much time in archiving these papers. Simply put them in a large envelope, or box, clearly labeled “TAX INFO 2022” and tuck them away in an attic, closet, or basement.
TOP TIP= Padded envelopes that things are delivered in are a cheap way to archive letter-sized paper!
And If you still have supporting tax documents dating back a decade or more, I encourage you to discard them as you see fit (toss, burn, or shred) and feel confident doing so! Hope this helps you tame your “paper tiger” at tax time!
PS: Remember I am a Certified Professional Organizer so please refer to these resources and consult with your tax advisor/accountant for advice on the best retention record for your circumstances!