You must keep these records to figure any depreciation, amortization, or depletion deduction and to figure the gain or loss when you sell or otherwise dispose of the property. Generally, keep records relating to property until the period of limitations expires for the year in which you dispose of the property. The following questions should be applied to each record as you decide whether to keep a document or throw it away.

Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

Keep records indefinitely if you file a fraudulent return.

Keep records indefinitely if you do not file a return.

Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.

Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction.

Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return.

Keep records for 3 years if situations (4), (5), and (6) below do not apply to you.

Period of Limitations that apply to income tax returns They help in preparing future tax returns and making computations if you file an amended return. Note: Keep copies of your filed tax returns.

Returns filed before the due date are treated as filed on the due date. Unless otherwise stated, the years refer to the period after the return was filed. The information below reflects the periods of limitations that apply to income tax returns. The period of limitations is the period of time in which you can amend your tax return to claim a credit or refund, or the IRS can assess additional tax. Generally, you must keep your records that support an item of income, deduction or credit shown on your tax return until the period of limitations for that tax return runs out. The length of time you should keep a document depends on the action, expense, or event which the document records.

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