Now that our 2015 taxes are completed and submitted, we decided to look into how long you really need to keep tax records. According to the United States IRS web site:
“Period of Limitations that apply to income tax returns
- Keep records for 3 years if situations (4), (5), and (6) below do not apply to you.
- Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return.
- Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction.
- Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.
- Keep records indefinitely if you do not file a return.
- Keep records indefinitely if you file a fraudulent return.
- Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.”
Gotta love numbers 4, 5 and 6!
So for the last couple of weekends, we have been scanning and shredding the old documents from 1977 – 2001. Some of the interesting things we found while decluttering this stuff:
- We were earning 12.45% interest on a savings account in 1984. No wonder we were able to double our savings amount in 5 years!
- We made less in 1984 (the year we got married) than we paid in federal taxes in 2014. How did we do it??
- Old tax form booklets included your social security number on the mailing label.
- Old receipts before 2000 frequently contained account numbers and sometimes drivers license numbers. We were surprised that many of these account numbers were the same as today.
- The shredder we purchased last year is worth every dollar! So far we have filled 5 kitchen trash bags of shredded tax remains.
- We have always documented and itemized what we donated to charity.
- We had a weird feeling not scanning these documents before shredding them. We decided to scan all officially submitted copies and W-2 forms in case we need those for social security reasons.
We still have a few years to shred but for now we are happy to be in the 21st century! The next 10 years worth of tax records can wait. We have other things we would rather do this afternoon!
4 thoughts on “Decluttering the taxes!”
[…] from 2011 and 2012 to shred. If you only need to keep these and their supporting records for 3 – 7 years (or indefinitely if you commit fraud hahaha – see this post) , then it seems like we can declutter […]
[…] be much higher. For the taxes, we counted each year removed as 1. The TAXES (read that post here) were a time consuming adventure! It just seems wrong to not keep a record so scanning essential […]
Great post as I just started the scanning and shredding process.
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Shredding and sorting takes longer than we thought. Have fun with it!
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