How Long Should I Wait Before Shredding Old Taxes?
If you’ve been wondering how long to wait to shred old tax documents, we’ve got the answers for you.
With tax season now behind us and a new year of filing and tracking underway, it’s important to keep up with clutter and stop careless loss of important documents containing sensitive information.
When storing away this past year’s tax documents, you may be able to create a little more room in your file cabinets by getting rid of very old files no longer required to have on hand.
If you’ve been wondering how long to wait to shred old tax documents, we’ve got some answers for you.
First, it’s not as easy as grabbing whole files and just tossing them. You should understand the reasons why you’re keeping this paperwork, and also how long the IRS has before coming to conduct an audit before deciding to get rid of them.
Generally, you have 3 years from the due date of a yearly tax return for the IRS to conduct an audit. So that might give you a sense of how long you need to store these before shredding.
Your W2s also provide proof of the amount you’ve been paid and paid out into taxes, 401k, and social security benefits. It’s a good idea to keep those stored somewhere until you actually start to get Social Security benefits. It might seem like a long time from now, but how else will you be able to go back and verify things if a problem or discrepancy arises? Especially pre-electronic access to these forms?
While you’re pulling old paperwork, be sure to also check with your local state’s tax record retention requirements as there may be other rules at play.
Here are some additional recommendations business site Kiplinger offers on what to keep stored safely for longer:
- 1099’s for self-employed individuals should be kept up to at least six years after filing.
- Poor stock picks and other bad debts can also be claimed, you’ll need to keep those records and documents for at least seven years.
- Claiming a foreign tax credit? You’ll need that proof around for 10 years.
Getting rid of this dated paperwork doesn’t mean simply tossing the files in the trash. They still contain personal identifying information and sensitive financial data that can lead to a security breach or even identity theft.
Choosing a responsible shredding company that guarantees your documents are shredded, recycled and incinerated in compliance with all regulations is the only way to maintain your peace of mind.
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