Posted by Sue on Feb 6, 2007
Most likely those of you outside the US have an agency making sure
that you pay your taxes correctly. In the US, it’s the IRS.
Last month a reader asked, “I have an attic full of old checks,how
long do I have to keep them?”
For quite a while my answer has been, ” Three years is the least
conservative amount of time; 7 years if you are super cautious, and
forever if the data is business related.” I would follow that up
with, “But I’m NOT an accountant; if you have one, do check with
him or her as this is NOT my area of expertise.”
Well, this time, I decided I would double check. I remembered
vaguely that someone told me I was having people save stuff longer
they need to. Whoa!
I decided to look at the official IRS site; hmmm not totally clear
to me. I wanted to hear it live. So I called one CPA who explained
that you should keep copies of your completed tax forms as reference
forever,but are only required to keep the back-up material for
three years. A second said basically the same thing,adding that he
has his more cautious folks keep back up material for 5-7 years.
My colleague, who does tax returns for his clients, said much the
same. He pointed out that you may want a paper trail for other
reasons but three years is the IRS requirement. Checks that are not
backing up tax related expenses are simply not needed for the IRS.
So here’s my revised response. Regarding the IRS: A)Please check
your particular circumstances with your accountant if you have one
B)Keep tax related back-up materials for a minimum of three years -
seven max, and C) Keep your completed tax forms themselves forever.