Sure, you want to keep that paperwork just in case, but a Lexington Law survey finds that one in five Americans have tax records going back more then sixteen years. Local CPA Jay Rabalais says that's a little overboard.
"The IRS is allowed to go back three years for an audit," Rabalais explained.
He points out that's three years from the filing deadline, so hang on to those records a little longer, just in case.
"Typically we advise clients to maintain tax records up to four years," he said. "The specific IRS rules and regulations call for three years after the date of filing is due."
Rabalais notes that it's three years after the return is filed: "That statute of limitations only starts to run if the returns are filed, so if you never filed a return, that clock never starts running."
And when you are in the clear to throw out your returns, make sure they're thoroughly shredded or even safely burned, to prevent sensitive data from falling into the hands of identity thieves.
Rabalais also tells us that if the IRS uncovers anything they think is a willful attempt to break tax law, they can go back as far as ten years to find evidence for prosecution.