You must keep your records as long as they may be needed for the
administration of any provision of the Internal Revenue Code.
Generally, this means you must keep records that support an item of
income or deduction on a return until the period of limitations for
that return runs out.
The period of limitations is the period of time in which you can
amend your return to claim a credit or refund or the IRS can assess
additional tax. The following table contains the periods of
limitations that apply to income tax returns. Unless otherwise stated,
the years refer to the period beginning after the return was filed.
Returns filed before the due date are treated as being filed on the
due date.
| IF you... |
THEN the
period is... |
| 1 |
Owe additional tax and
(2), (3), and (4) do not
apply to you |
3 years |
| 2 |
Do not report income
that you should and it is
more than 25% of the
gross income shown on
your return |
6 years |
| 3 |
File a fraudulent return |
No limit |
| 4 |
Do not file a return |
No limit |
| 5 |
File a claim for credit
or refund after you filed
your return |
Later of 3 years or 2 years after tax was
paid. |
| 6 |
File a claim for a loss
from worthless securities |
7 years |
Keep copies of your filed tax returns. They help in preparing
future tax returns and making computations if you later file an
amended return.
Employment taxes.
If you have employees, you must keep all employment tax records for
at least 4 years after the date the tax becomes due or is paid,
whichever is later.
Assets.
Keep records relating to property until the period of limitations
expires for the year in which you dispose of the property in a taxable
disposition. You must keep these records to figure any depreciation,
amortization, or depletion deduction and to figure your basis for
computing gain or loss when you sell or otherwise dispose of the
property.
Generally, if you receive property in a nontaxable exchange, your
basis in that property is the same as the basis of the property you
gave up, increased by any money you paid. You must keep the records on
the old property, as well as on the new property, until the period of
limitations expires for the year in which you dispose of the new
property in a taxable disposition.
Records for nontax purposes.
When your records are no longer needed for tax purposes, do not
discard them until you check to see if you have to keep them longer
for other purposes. For example, your insurance company or creditors
may require you to keep them longer than the IRS does.
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