- Days left
The general rule of thumb for tax records is to keep everything for at least three years, but there are some things you should keep longer. Throughout the year, I recommend that you keep your pay stubs, mortgage statements, bank statements, home purchase and renovation receipts, investment account statements and receipts for anything that might be used on your tax return.

Once you receive your W-2, you can throw out the pay stubs. Once you receive your 1098 for mortgage interest paid, you can discard your monthly mortgage statements. Most of the other documents mentioned above should be kept with your tax return for the three year period. Items related to your home purchase, rental property purchase, or major renovation should be kept until you sell the property.

Anything that has been deducted on the tax return should have documentation in your files, in case the IRS ever questions it. You may have heard that you should keep your records for seven years, rather than the three years I've mentioned above. Three years is the time frame during which the IRS can audit your tax return, while seven years is generally the time period during which the IRS can bring a criminal tax fraud case against you. Since most of us aren't engaged in serious tax fraud, we probably don't need to maintain our records for seven years. Some people still like to be cautious though, and keep the records for the longer period.

You can find more information about good recordkeeping practices at the IRS website.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

Increase your money and finance knowledge from home

How to Buy a Car

How to get the best deal and buy a car with confidence.

View Course »

How Financial Planners go Grocery Shopping

Learn to shop smart and save.

View Course »

TurboTax Articles

Video: Tax Guidelines About Gifting

Note: Some of the content of this video applies only to taxes prepared prior to 2012. It is included here for reference only. Find out the tax guidelines about gifting with help from TurboTax in this video on tax tips.

Video: What are Income Tax Rates?

Note: The content of this video applies only to taxes prepared for 2010. It is included here for reference only. Income tax rates change depending on both the amount of money you make and how you made it. Find out about income tax rates with help from TurboTax in this video on tax tips.

Video: How To Reduce Errors on Your Tax Return

Did you know that errors on your tax return can affect the amount of your tax bill and the amount of time it takes to get a refund? Fortunately, TurboTax helps you avoid errors AND be sure you're getting all the tax deductions and credits you deserve.

Does Your Company Need to File Form 1095-B?

A company is responsible for filing IRS Form 1095-B only if two conditions apply: It offers health coverage to its employees, and it is "self-insured." This means that the company itself pays its employees' medical bills, rather than an insurance company. A company that doesn't meet both conditions won't have to deal with Form 1095-B. Its employees might still receive a 1095-B, but from their insurer, not the employer.

Video: Who Qualifies for an Affordable Care Act Exemption (Obamacare)?

The Affordable Care Act requires all Americans to have health insurance or pay a tax penalty. But, who qualifies for an Affordable Care Act exemption? Find out more about who qualifies for an exemption from the Affordable Care Act tax penalty, how to claim an exemption on your tax return and how the Affordable Care Act may affect your taxes with this video from TurboTax.

Add a Comment

*0 / 3000 Character Maximum