In most cases the statue of limitations will expire in three years as far as an
IRS audit is concerned but... it can be for longer if the IRS feels that you have scammed them.
There are some documents that are more important to save than others.
A good idea is to have a fireproof box or a small safe that is fireproof to keep the papers in.
If there is a fire you will be lucky to have saved the past info for the immediate future.
I would also scan my documents and keep that hard drive in a safe as well as in my active computers - password protect them if you want to be safer from prying eyes.
Keep your income documents for three years. They are W2 forms, 1099 forms, paid off student loan forms, rental income documents, etc.
This is because you could be audited or you might want to get a change in your tax filing for a larger rebate.
The period of limitations is what is concerned here. The period of time, which is three years, is the limit of time where you can amend your return or file for a credit or a refund.
Should be kept until you no longer own the property or have paid off your loans completely.
Your health care insurance company will know how long you should hold onto any healthcare paperwork as they may have a different set of rules from the IRS.
You will have to prove to the IRS that you do or do not have unreported income for up to six years. That would be for more than 25% of your gross income.
The IRS has no limit of time for auditing what they consider to be a fraudulent return.
If you feel that you were not honest on a filing then you should keep your paperwork indefinitely because they could come after you and want your information.
Montana requires you to save info for 5 years and California has a four year limit. The other states maight be different so look up that info with your state.
This IRS website will tell you what other reasons there are for keeping documents for a longer period.
Save these ownership documents such as motor vehicle titles or estate documents etc., until you sell the property.
As far as personal ID such as birth certificates or social security cards are concerned, save them for the person's entire life.
Roger Chartier - The Author