It’s important to know how long to keep tax documents, while also avoiding risk of fraud or identity theft but keeping sensitive documents accessible. Here are three ways to keep your documents secure:
For physical documents, protect your paper records from damage or theft by storing them in a designated, safe spot in your home or office. Digital records should be archived, electronically backed-up and protected with a password.
Use unique and complex passwords that are changed often and different than your personal email or social media accounts. Antivirus software can also protect your electronic devices and accounts.
Simply throwing away paper documents with personal and financial account information can put you at risk for fraud or identity theft. Shredding can be done at home with a personal shredding device, but an easy and free way to safely dispose of documents is at an on-site shredding event, such as the one that we are hosting at the Anderson, Adkins & Company office on May 6. This event is open to the public and free to shred your personal documents securely and safely.
The Internal Revenue Service requires record retention as long as your return is open under the statute of limitations. Generally, the statute of limitations is:
Keep all bank statements, checks, receipts, and other financial records for at least 3 years (previously 6 years,) especially those documents that will support your tax return(s) including Forms W-2 and 1099, bank and brokerage statements, tuition payments and charitable donation receipts.