Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Tax Records - What You Should Keep And For How Long > NetSparsh - Viral Content you Love & Share

Tax Records - What You Should Keep And For How Long

Many taxpayers are confused about how long they should keep tax records. The term "tax records" refers to your tax returns and the documents that support the information in the returns. These documents can include receipts, bank statements, 1099s, etc. If you are one of the unlucky few to be audited, these records will be vital to fending off the IRS.

Tax Returns

To protect yourself from a nasty audit, you should keep all of your tax returns indefinitely. The IRS has been known to lose or misplace tax returns. While conspiracy advocates argue that this is evidence of a nefarious scheme, the simple fact is that the IRS receives millions of returns over a three-month period and lost returns are inevitable. So how do you protect yourself? You keep copies of every single tax return.

A quick word on the IRS e-file program. If you file your returns electronically, make sure you get copies from the company that filed your return. All such entities are required by law to provide you with paper copies.

Records Supporting Tax Returns

You should keep supporting tax records for a period of six years from the date the returns were actually filed. In general the IRS only has three years to audit you from the filing date. For example, if you filed your 2000 tax return on April 15, 2001, the IRS would have to start an audit by April 15, 2004. Keep in mind that if you filed an extension, the IRS will have three years from the date you submitted the return. As is always case with taxes, there are exceptions to this general time period.

If your tax return looks like the great American novel, the running of the three-year audit period may not save you. Failure to report more than 25% of your gross income gives the IRS an additional three years to pursue you. Using the previous example, the IRS would have until April 15, 2007 to audit your 2000 tax return.

Property Records - Get A Filing Cabinet

You may need to get a filing cabinet if you hold property for an extended period of time. For example, assume that you purchased a home in 1980 for $100,000 and made $50,000 in improvements over the years. You need to keep the purchase records, mortgage statements and receipts that relate to the improvements. When you sell the home, you will need the records to determine the tax consequences of the sale, to wit, your basis (original cost plus improvements) and profit. If the IRS decides to take a closer look at the reported profit, you will need to provide your tax records to support your claims. Once you actually sell the property, it is recommended that you keep all of the tax records for an additional six years.

Divorce

Make sure you keep copies of all of your financial documents, tax returns and supporting documents if you get divorced. You should also keep copies of all divorce agreements and court orders that cover property and financial issues. When couples divorce, the tax and credit consequences can be nightmarish. If you don't keep records, you will have to ask your ex-spouse for them. Get the records now to avoid doubling your misery!

Hopefully, you will never need to show your tax records to the IRS. If you are one of the unlucky few that is audited, your tax records should keep your feet out of the fire.

Richard Chapo is CEO of http://www.businesstaxrecovery.com - Obtaining tax refunds for businesses by finding overlooked tax deductions and credits through a free tax return review.

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

Bloomberg

Top 3% of US Taxpayers Paid Majority of Income Taxes in 2016
Bloomberg
Individual income taxes are the federal government's single biggest revenue source. In fiscal year 2018, which ended Sept. 30, the individual income tax is expected to bring in roughly $1.7 trillion, or about half of all federal revenues, according to ...
REVEALED: Top 3% of America's taxpayers paid majority of income taxes in 2016Daily Mail

all 25 news articles »

Vox

Jared Kushner reportedly paid little to nothing in taxes for years — and it was completely legal
Vox
Jared Kushner, President Donald Trump's son-in-law, probably paid little to nothing in federal income taxes for multiple years, even as his net worth soared, according to a new report. And it was all likely completely legal. Jesse Drucker and Emily ...
The creative accounting that reportedly allowed Jared Kushner to dodge paying income taxes for years is totally legalBusiness Insider
New York Times: Kushner likely paid almost no federal income taxes for yearsCNN
How Jared Kushner Avoided Paying TaxesNew York Times
TIME -Rolling Stone -The Hill -New York Times
all 193 news articles »

Motley Fool

Beware: Social Security Can Make Your Taxes Soar
Motley Fool
There are still a few months before tax season begins, but for retirees on a fixed income, any hint of a higher tax bill requires careful pre-planning. For the most part, typical American retirees generally have modest incomes and are therefore in ...
Attention, High Earners: You Could Pay an Additional $279 in Social Security Tax in 2019Yahoo Finance
Your 2018 Guide to Social Security BenefitsMotley Fool

all 89 news articles »

South Korea considers cutting taxes on oil products amid rising pump prices
S&P Global Platts
Seoul — South Korea is considering cutting taxes on retail oil products to help ease the financial burden for consumers and boost domestic demand amid a slowing economy, a finance ministry official said Monday.

and more »

CNBC

Here are the best and worst states for taxes
CNBC
With federal income tax rates for all taxpayers down as of this year, you might be looking forward to a lower tax bill for 2019. Of course, what you pay to Uncle Sam is only one piece of your tax picture. Ever wonder how your state tax burden fares in ...
Report: Hawaii residents pay more in taxes than those in most other statesHawaii News Now

all 5 news articles »

Milwaukee Journal Sentinel

Tony Evers says he would cut income taxes by 10 percent for the middle class
Milwaukee Journal Sentinel
MADISON - Democrat Tony Evers pledged to cut income taxes for the middle class by 10 percent Sunday if he is elected governor, paying for his plan by rolling back a tax credit for manufacturers and farmers. Evers, the state schools superintendent ...
Tony Evers proposes cutting middle class taxes 10 percentMadison.com
Evers proposes tax cuts; Walker calls it publicity stuntkwwl.com

all 76 news articles »

The Hill

What Trump's tax story says about media manipulation
The Hill
The first hint came about a month and a half ago. A well-connected Democrat laid out a new scenario to me. It went something like this: “Democrats will take over the House and possibly the Senate after the midterms. We'll demand that Trump release his ...
Top-Spending Republican Group Says Little About Trump Tax Law in CampaignBloomberg
House Ratings | Inside ElectionsInside Elections
Trump approval rises, even as Democrats maintain clear midterm advantage - The Washington PostWashington Post
USA TODAY -USA TODAY
all 262 news articles »

KNWA

Arkansas Deadline to Pay Property Taxes is Monday, October 15
KNWA
Arkansas (KFTA) -- - Monday, October 15 is the statewide deadline to pay your property taxes in Arkansas. Most counties allow you to pay your tax bill online, however if you have any questions about that you should contact your county's tax collector.

and more »

CNN

NYT: Kushner likely paid little or no federal income taxes for years
CNN
NYT: Kushner likely paid little or no federal income taxes for years. Newsroom. Jared Kushner, whose net worth is nearly $324 million, appears to have paid almost no income taxes from 2009 to 2016, The New York Times reports. Source: CNN ...


Wall Street Journal

When the Fever Passes, Learn From Trump's Taxes
Wall Street Journal
Last Saturday's column on the New York Times investigation of Trump family tax dodging put aside the question of whether hefty inheritance taxes are good public policy. Let's take it up now. Those who complained that my nondefense “normalized” Trump ...
Donald Trump Is a Criminal Tax CheatThe Nation.

all 4 news articles »
Google News

Where to Find Tax Breaks for Your Home Based Business

April 15th looms in front of most people every year... Read More

Business Tax Deductions

As we enter mid-March, taxpayers begin to become very interested... Read More

The Tax Man Cometh... To Search

You're at your office, or home, and the doorbell rings... Read More

Correspondence From The IRS ? Yikes!

It's a moment every person dreads. You pick up the... Read More

Alas! In E-Commerce Taxland

In trying to comply with tax laws for your e-business,... Read More

Gambling Income and Expenses - Tax Requirements

Hit a big one? With more and more gambling establishments,... Read More

The Internet Tax Man Cometh

Q: I was contacted by the city tax collector to... Read More

How to Donate Your Car to Charity and Get Tax Deduction

Donating your used car to charity is a win-win situation;... Read More

What to Do If You Can?t Pay Your Taxes

The end of tax filing extensions is quickly approaching. What... Read More

I Havent Filed a Tax Return with IRS in Years, What Do I Do?

In elementary school, kids come up with creative excuses why... Read More

Tax Trap #5 -- Ignoring The IRS (and the 5 best ways to contact them!)

We all love to criticize the IRS, don't we? And... Read More

Estate Taxes - It Pays to Plan Ahead

Estate taxes. It's not enough to simply know they exist,... Read More

Save Money on Taxes - Let Uncle Sam Pay for Your Fun!

"Deducting Meals and Entertainment"O.K. You've been working really hard on... Read More

How To Get An Instant Pay Raise

As a gentleman was leaving my class recently, he wanted... Read More

Organizing Your Taxes

Does this scene sound familiar? It's April 7. You haven't... Read More

What You Need To Know About Taxes If You?re Getting Married

It may not be high on the list of wedding... Read More

IRS Reports Tax Gap of $300 Billion

The Internal Revenue Service is reporting that the difference between... Read More

1031 Exchange Rules and Requirements

Following is a reproduction of the IRS's rules and requirements... Read More

10 Thoughts on Tax Offer in Compromise

Beware of advertisements that claim to settle tax debts for... Read More

Home Business Tax Tips

If you have recently started an Internet or home business,... Read More

About Income Taxes; Tidbits

1812The first attempt to impose an income tax on America... Read More

Early Distributions From Retirement Plans

An early distribution from an Individual Retirement Arrangement (IRA) or... Read More

Amending Procedural Laws for Collection of E-taxation

The electronic transaction ordinance defines the certificated copies in which... Read More

Are You An Innocent Victim of These Popular Myths?

Misconceptions, misinterpretations and just plain "untruths" are floating about income... Read More

Navigating The Internet Sales Tax Laws

QUESTION: I have been contacted by my local city... Read More