How long should I keep my tax return and documentation?
You should keep copies of tax returns, worksheets used, and records of all items appearing on the returns (such as W-2 and 1099 forms) at least until the statute of limitations runs out for that return. Usually, this is three years from the date the return was due or filed or two years from the date the tax was paid, whichever is later.
If a tax return has passive losses from rental properties, nondeductible IRA contributions, net operating losses from a business, or other items that carry forward to future tax returns, you should retain the tax return indefinitely or until any carryforward is used on a future tax return.
If you have any stocks or real estate, it is important to retain records that show the purchase price of those investments. This is so when you sell the stocks or real estate, you will know the cost basis to enter on your tax return.
If a tax return has passive losses from rental properties, nondeductible IRA contributions, net operating losses from a business, or other items that carry forward to future tax returns, you should retain the tax return indefinitely or until any carryforward is used on a future tax return.
If you have any stocks or real estate, it is important to retain records that show the purchase price of those investments. This is so when you sell the stocks or real estate, you will know the cost basis to enter on your tax return.
