tax tips for tax year 2008
Tax Tip 23 Records Retention & Copies of Returns
Once your tax return is prepared, you should keep all receipts, cancelled checks or other proof of payment, and other records to support deductions or credits you claim on your return. The length of time you should keep these records can vary.
Keep items that support an item of income or deduction appearing on a return until the statute of limitations for the return expires, which is:
• Three years from the date you filed the return (or the return due date if you filed a return before the due date) for an assessment of tax, unless fraud or substantial underreporting of income is involved;
• Three years from the date you filed the return (or the return due date if you filed a return before the due date) for filing a claim for credit or refund; or
• Two years from the date you paid the tax, whichever is later.
Records relating to the basis in property should be retained until after you dispose of the property and report any gain or loss.
File Form 4506 to request copies of income tax returns and income source information. There is no cost to obtain tax return transcripts or income source information. There is a $57 fee per return, however, to obtain copies of actual returns and attachments. If the IRS cannot find a requested tax return, it will refund the fee.