In my case my thumb drive stopped working and I realized I had not backed it up for years. I now have several years of tax records not available. Not sure of the penalty.
Keep enough Ammo on hand to cover ten years of IRS thug attacks.
“...my thumb drive stopped working....”
More likely you.....
I’d say, with the regime, forever.
I wiped all my financial records with a cloth.
I keep my returns forever, but discard the supporting documents after five years.
If you keep records beyond their required retention date, they can be subpoenaed if the government finds out that you still have them.
-PJ
From birth to death...
I was born in 1933 and cannot find my records before 1990...
I wasn’t sure where I was tax-wise last year. As it turned out I had enough withholding to even get a refund after paying taxes
Because I was working part time in 2022 I think I paid $1500 or more in taxes. Still I got back about $400 which was great. 👍👍
I was looking for potential deductions but didn’t have enough to exceed the standard deduction level.
Still in my haste I filed it even though it made no difference. Oops 😬😬😬
Guess I should refile and remove my what-if deductions. Even though it won’t change my refund I’d like to do it.
Why Did The IRS Destroy 30 Million Paper Returns?
https://www.crapo.senate.gov/news/in-the-news/weekly-column-why-did-the-irs-destroy-30-million-paper-returns
the IRS destroyed an estimated 30 million paper-filed tax documents without processing them.
IRS unable to locate millions of tax records, watchdog says
https://www.politico.com/news/2023/08/10/watchdog-irs-tax-records-00110637
The watchdog said it found seven empty boxes at the IRS’ facility in Ogden, Utah, that should have contained as many as 168 microfilm cartridges, which hold up to 2,000 photographic images each, and that the IRS personnel there were unable to point to the location of the cartridges.
TIGTA noted that this may be because the vendor responsible for creating the cartridges went out of business abruptly in 2018.
______________
IRS cannot find millions of backup tax records, watchdog says
https://www.cnn.com/2023/08/11/business/irs-tax-records-missing/index.html
The Internal Revenue Service cannot locate thousands of microfilm cartridges storing millions of sensitive business and individual tax account records
Forever should the records serve you well.
No statute of limits for murder and taxes IIRC.
Previous info was 7 years.
But now, a judge in New York probably decides on a case by case basis.
I may be one of the odd ones but I have every tax filing going back to the first year I filed (1968). I don’t save they because I may need them with the IRS but because they are an easy way to keep my personal history. They show where I lived and where I worked and how much (or how little) I made.
Not sure what I did with them before that, but I know I filed every year - didn't have much so it was an easy task to do myself.
My former CPA/CFP was audited by the IRS 5 times. His claim to fame was land trusts keeping “inheritance” taxes off properties to be kept in families to the tune of about 3 Billion dollars. They hounded him relentlessly, finally offering him a JOB as his work was so meticulous and he knew and studied tax code like Talmudic scholar does Torah.
HIS advice on keeping tax records?
IRS can, and have in his experience, subpoena records going back a decade and LONGER.
It doesn’t take up much space, kept in large envelopes about 3/4-1” thick per year. I keep records going back 20 years.
He was the first person to ever point out to me the often-missed detail that “The IRS” spells out “THEIRS.”
It’s NOT “our” money.
So I don’t have to keep the last 25 years worth of ‘everything’? Thanks for posting.
It’s best to turn them in by 4/15—or 10/15 with an extension.
Right now, that would be 2022 (what would be considered current), 2021, 2020, 2019 (first 3) and 2018, 2017 and 2016 (second set of 3). The filing extension deadline is October 15, so on October 16 you need to keep 2023 (which would then be considered current). 2022, 2021, 2020, 2019, 2018, and 2017.
Along the same lines, if you discover an error in an already filed return that would produce a refund to you, you can file an extension to claim the refund for the current year plus 3. On the other hand, if the IRS discovers a problem in your filed returns that creates a tax liability, they can go back 6 years. Why? Because it's tax law.
I keep 7 years worth of returns on my computer/back up and also store hard copies in a file cabinet - each year I toss the contents of the oldest folder and replace it with the new returns.
I and my tax accounting service BOTH keep ALL information used to file my taxes, DIGITALLY.
I have records going back into the 90’s !
I personally have them backed up in several places (including off-site).
Interestingly, a couple years ago I needed to file an “amended” return and send a check for the difference.
The IRS never deposited that check!
But a year later sent me a letter demanding that money (with interest).
My tax advisor took care of this for me. They had sent my amended return certified receipt mail and had a copy of the check they included.
Finally, the IRS relented their demand, since they could not prove I had not already paid.
Maybe some day they will find that check and try to deposit it? I keep enough in checking, just in case!
I had a habit of just keeping them forever. Recently we were moving and I found some returns from the 70’s. You think taxes are high now? In ‘78 I made about $27k, a good salary, and my total tax including Social Security was over $14k.