Learn how long to keep tax returns.

A businessman reading and reviewing tax returns in the office.
Learn how long to keep tax returns and why digitizing them is a safer way to store your documents.

We all know how important it is to save your tax returns, but the question remains — how long should you actually keep tax documents? This article explains why you should archive tax documents, how long to keep tax returns, and the best way to do so.

Why keep tax records?

Keeping tax documents is important in case of an IRS audit. You’ll need your tax returns to back up your claims about both paid and owed taxes.

You may also need to show tax documentation when applying for a mortgage, a large loan, or student aid. Old tax returns are also useful references when amending tax returns or filing taxes in the future.

How long to keep personal tax returns.

The IRS recommends that individuals keep their personal tax return documents for a minimum of three years. This duration allows for addressing any questions or issues that may arise from the filed returns. Keeping personal tax returns for three years ensures easy access to information in case of audits or the need to amend the tax return. It’s important to note that individual circumstances may vary, and consulting with a tax professional or accountant can help determine specific retention requirements. By following these guidelines, individuals can maintain proper financial records, facilitate efficient tax management, and ensure compliance with tax laws and regulations.

How long to keep tax returns for business.

For businesses, including small business owners and self-employed individuals, the IRS recommends keeping tax return documents for a longer duration of six years. This extended time frame takes into account the more complex financial records often involved in business operations, such as income and expense statements, receipts, and supporting documents.

Retaining these records for six years ensures compliance with IRS guidelines and provides a comprehensive record of business activities in case of audits or other financial inquiries. However, it’s important to consult with a tax professional or accountant to determine specific retention requirements based on the unique circumstances of the business.

Adhering to these recommendations allows businesses to maintain proper financial records, facilitate efficient tax management, and ensure compliance with tax laws and regulations.

How long to keep tax records in physical form?

When it comes to physical tax records, it’s generally recommended to keep them for the same durations as their digital counterparts, such as three years for personal tax records and six years for business records. However, transitioning to digital record-keeping offers benefits such as streamlined document management and improved accessibility. Before going fully digital, ensure that digitized copies are accurate, complete, and legible, and establish a reliable backup system.

Knowing how to scan receipts and effectively organize them is crucial for tax purposes, especially when considering how long to keep tax returns for a business. By digitizing and categorizing receipts, you can ensure easy access, accurate record-keeping, and seamless tax preparation in the long run.

While there’s no specific requirement from the IRS regarding retaining physical records after going digital, it’s advisable to hold onto them for an additional year or two as a precautionary measure. In the end, the decision to go fully digital should be based on individual circumstances, compliance with IRS guidelines, and consultation with a tax professional or accountant for tailored recommendations.

How to save tax returns as a PDF for archives.

When it comes to archiving tax returns, converting them into PDF format offers a convenient and secure solution. By digitizing your documents into PDFs, you can safeguard them from physical damage and loss. To effectively store and organize your tax records, follow these tips:

You can do these organizing tasks with PDF editing software like Adobe Acrobat or with Adobe Acrobat online services. Find out more about how to work with PDFs online.

Discover everything Adobe Acrobat can do to create accessible documents today. You can edit PDFs, fill and sign PDFs and forms, combine PDFs into a single file, and much more.