How Long to Keep Tax Records for the State and IRS

If you’re reading this, congratulations! You survived tax season. So, what’s next? Well, it’s time to start taking baby steps towards getting your documents ready for next tax season. And how do I do that? Well, you can start by properly storing your documents, so you will have them next year.

Rare Tax Situations: When Should I Keep My Tax Documents Indefinitely?

When it comes to deciding which documents you should keep, it generally depends on both the documents filed and your tax situation. Even though the IRS only requires you to hold onto your tax documents for until the end of the statute of limitations, you will never regret holding onto them indefinitely. While it is extremely rare, a situation may arise in the future where you are required to prove your employment, residency or income.

As a caveat, if you didn’t file a return for any given year or you filed a fraudulent return, it is important to keep your taxation records indefinitely. This is obviously not a situation you should aim for.

How Long Should I Keep my IRS Taxation Documents

The period of time you are required to hold onto documents depends on your taxation situation. Below, you will find some common tax situations:

• As a general rule, in a typical tax-filing situation, the IRS has three years to decide to audit your tax return. So, according to this rule, you should keep your taxation documents for three years. Additionally, you have three years from when you filed your return to claim a refund from the IRS.
• If you file a claim for a loss from worthless securities, keep your tax documentation for 7 years.
• If you do not file your taxes, or if you have a fraudulent return, there is no statute of limitations and the IRS can go back indefinitely. If you’ve under reported your income by 25 percent, the IRS can go back six years.

ezStorage Has Document Storage Solutions

When storing your documents, there is a fine balance between storing them in a location where you will not lose them and storing them in a location where hackers and scammers can’t get access to them. It seems like every time you turn on the television you hear about a major company getting hacked, and millions of people’s personal information getting leaked. This has led to a lot of skepticism around storing personal information online or in the cloud. Instead, consider storing your documents in a storage unit.

When storing your documents, it’s important to use a climate controlled storage unit. ezStorage has storage units that can control the climate, ideal for the storage of sensitive documents. We have storage facilities with climate controlled storage units in the Baltimore, MD, Columbia, MD and Washington, DC area. Contact us to rent a self storage unit today!