How long does someone have to keep tax records? 3 Answers as of December 16, 2010

How long should someone keep tax records?

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Mankus & Marchan, LTD
Mankus & Marchan, LTD | Tony Mankus
Six years would be a good length of time. IRS has 3 years to audit your tax returns after you file them and six years for criminal prosecution. After that, the statutes of limitation expire.
Answer Applies to: Illinois
Replied: 12/16/2010
Meyer & Yee, LLP
Meyer & Yee, LLP | Kent W. Meyer
It depends on what the issue is. There are different statutory times for different items. Records relating to income could be required indefinitely although as a practical matter it is less. For most issues three years is adequate.
Answer Applies to: California
Replied: 12/15/2010
Givner & Kaye
Givner & Kaye | Bruce Givner
The normal IRS statute of limitations is 3 years. In cases where there is a "greater than 25% omission of gross income," the statute of limitations becomes 6 years. So, the rule of thumb is 7 years. However, there are some situations in which records are supposed to be held forever, e.g., to prove how much you paid for an asset.

The best source for the answer to this question is the CPA who prepares your return. (I am a tax lawyer, and I do tax planning, not tax returns.) If you don't use a CPA to prepare your return, you should hire one now. As Red Adair, the famous oil well firefighter once said, "If you think hiring a professional is expensive, wait until you hire an amateur."


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Answer Applies to: California
Replied: 12/15/2010
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