I have kept all my tax returns but as far as tracking basis for investment I find that to be a pain to file every record of monthly investments and reinvested dividends/capital gains. Doesn’t the brokerage maintain information on your basis?
Doesn’t the brokerage maintain information on your basis?
Right. I closed a credit union account one year, and the following January I got an email that my tax forms were online and ready. Problem is, they closed my account the day I transferred the last money out! I called and they did mail me a paper copy.They should, but they have only had to do that for about the last ten years.
And there is always the issue of data being lost when you transfer an account from one brokerage to another, especially in prior years. So it's wise to keep as much of a record as you can.
They should, but they have only had to do that for about the last ten years.
And there is always the issue of data being lost when you transfer an account from one brokerage to another, especially in prior years. So it's wise to keep as much of a record as you can.
Gosh no. Especially if you own any type of property that has tax consequences (ie IRA's, real estate etc).
The IRS says that you need to keep your records until you have disposed of the property -- even if it is more than 7 years.
-gauss
they should, but they have only had to do that for about the last ten years.
And there is always the issue of data being lost when you transfer an account from one brokerage to another, especially in prior years. So it's wise to keep as much of a record as you can.
I was on a shredding binge today where I found that apparently I never do any . . . Had the purchase papers from a car I bought in 1995. . . .
Taxes are next. . . Do I really only need 7 years? Do I ditch the 1099s then too? I probably have at least 20 years. . . Somehow they are hardest of the papers to get rid of.
I thought the IRS can only audit you within 3 years?
all bets are off on that if fraud is suspected
We just took money from ROTH accounts for the first time. Both DW and I are well over 59.5. Turbo Tax asked for the amount of total contributions (not including conversions) to ROTH accounts. I haven't kept those records per se, but since Turbo Tax has asked for contribution amounts in the past, last year's pdf of our tax return had an accumulated amount! Yikes. That saved me a major headache.
We just took money from ROTH accounts for the first time. Both DW and I are well over 59.5. Turbo Tax asked for the amount of total contributions (not including conversions) to ROTH accounts. I haven't kept those records per se, but since Turbo Tax has asked for contribution amounts in the past, last year's pdf of our tax return had an accumulated amount! Yikes. That saved me a major headache.
I've noticed that TTax asks that question and offers to track your Roth basis, but if you've had a Roth account for more than 5 years, the answer doesn't matter anyway. They should really change that screen so that it asks you when you established your first Roth and then only asks about contributions if you say it's less than 5 years old.
iRS: "we believe you massively understated your income 5 years ago."
Taxpayer: " you can't prove that, cuz I shredded all the evidence."
IRS: " Not my problem. Here is your assessment of tax penalty and interest."
Granted, these are remote risks but keeping 7 years of tax returns and support should be a minimum for most taxpayers.
So the IRS says 3 years but I keep a rolling file with 4 years...I never understood when year 3 ended and year 4 began.
I also keep closing statements for homes until 4 years after sold (same file).
The actual returns are all saved digitally (& on TT).....the receipts, w2s, 1098s, etc, is what's in the paper file....and it has become a slim file over the years....But I also don't bother to print investment firm tax documents if they have their 7 years archived online. I figure I can fetch them if the IRS comes calling.