How many years do I have to keep my income tax forms and/or backup documentation?

ANSWER

Expert Michael Lim's Answer:

The general rule is that you should keep copies of income tax forms and backup documentation for at least 5-7 years.  

The IRS has a general statute of limitations for audits in that they have 3 years to assess taxes (3 years after the tax return was filed with the IRS).

However, if the IRS finds that you have omitted greater than 25% of your income for any time period, they have up to 6 years to audit you.

Reference:  

Under section 6501(a) of the Internal Revenue Code (Tax Code) and section 301.6501(a)-1(a) of the Income Tax Regulations (Tax Regulations), the IRS is required to assess tax within 3 years after the tax return was filed with the IRS. Similarly, under 301.6501(a)-1(b) of the Tax Regulations no proceeding in court by the IRS without assessment for the collection of any tax can begin after the expiration of 3 years.

Michael Lim, CPA

California

16 yrs experience

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