Suggested Holding Periods for Tax Records:
1. It is a good policy to save copies of your 1040 and supporting schedules indefinitely.
Some reasons to hang on to your tax records, and supporting documents be:
- Due to an audit by either the IRS or Oregon Department of Revenue
- To substantiate stock or mutual fund basis.
- To establish the basis in depreciated property.
- To establish basis in rental property.
- To document the sale and exchange of your personal residence.
2. The IRS requires record retention as long as they are important for Federal Tax law. Generally this means:
* 3 years from the date the return is filed…or
* 2 years from the tax payment date…or
* 6 years, if income is under-reported by more than 25%
(whichever is later).
The City of Portland / Multnomah County tax filings request that you save your returns and documentation for 7 years.
3. Keep ALL–bank statements, checks, receipts and other financial records for at least three years, especially those documents that will support your tax return figures.
4. HOLD INDEFINITELY
* All papers and receipts that deal with any purchase, sale and major improvement of your current and all previous principal residences.
* All IRA records, investment purchases and sales, and 1040 returns filed for each year.