When you’re gathering your tax information this year, you may run across old information and wonder whether it’s okay to discard it. In general, you should retain supporting documentation for a minimum of three years after the date you file your return (or its due date, if later) — six years is safer. And there are some items you should never throw away.
Here are some guidelines.
- Copies of federal and state income-tax returns — indefinitely
- Detailed information used to prepare your return, such as W-2s, 1099s, K-1s, receipts, and canceled checks — for six years
- Records of investment and real estate purchases — for six years after you sell the investment or property
- Once you have verified the accuracy of your W-2, there is generally no need to retain your old pay stubs. However, you should keep your year-end or final pay statement if you’ve had potentially tax-deductible amounts withheld from your pay, such as charitable donations, medical insurance premiums, or union dues.
Even when you no longer need your records for tax purposes, you might need them for other reasons. For example, your insurance company may require you to have certain records to substantiate a claim.
Don’t deal with tax issues on your own. Call us right now at 818-404-1084 to find out how we can provide you with the answers you need. Our Los Angeles CPA firm specializes in IRS tax solutions and strategies.