How long should I keep my tax documents for? This is a common question we encounter quite often.
We suggest that you keep copies of all of your old income tax returns as well as w2’s, as there may be many unanticipated issues such as documentation of social security wages.
However it does not seem necessary that all the supporting documentation be kept no more than 7 years.
Keeping a tax return permanently provides support if the IRS contends your client did not file a return or filed a fraudulent return. Furthermore, you may need to refer to an old return to obtain information about:
- Home purchases and sales
- Depreciation of a home office, rental property, or business equipment
- Individual retirement account (IRA) contributions
- The purchase price of stocks, bonds, and mutual funds
- The taxability of pensions and annuities
Please note that it is recommended that you review your earnings and benefit statement on file with social security, as this will affect any Social Security benefits you may be entitled to. Also a current Earnings and Benefit Statement can be requested on the internet at www.socialsecurity.gov