You’re swimming in paper. This article helps you know what to keep and what to toss.

The ground rules: You should keep all your tax records for at least the three years the IRS has to audit you and assess any additional taxes. The IRS has six years if you understated your gross income by more than 25%. Some accounting organizations are recommending that all records be kept for a minimum of seven years. There is no statute of  limitations if you failed to file a return or filed fraudulent returns. In these cases there would be no statute of limitations on how long you had to have kept your records..

Tax returns and supporting documents: At the minimum, keep them three years. I am becoming more inclined to say that all records should be kept for a minimum of seven years after their appearance on a tax return. I like keeping the tax returns but not the supporting documents forever for the very rare times a governmental agency sends a notice out saying you haven’t filed a tax return you in fact filed years ago.

Yearly income: Keep your last pay stub to see if your W-2 accurately reflects your income. Keep a record of every check you receive, especially the unusual ones that you’re more likely to forget. Record what comes in be it free lance or wage income, dividends and interest, rents, alimony, social security, unemployment or gifts and check it against your W-2’s, 1099’s and K-1’s.

Yearly expenses: You need to know how much you spent for deductible items like charitable contributions, mortgage interest, real estate taxes, medical expenses, alimony, child care expenses, and business/ job expenses. Keep sales slips, invoices, receipts, and canceled checks or other proof of payment. The more records you keep, the more likely you’ll be able to be accurate on your tax returns.

Assets: You must keep the records for any asset that you bought for at least the number of years it is being depreciated plus 6 years. For instance if a business property is being depreciated for 39 years, you have to keep the records for all the time it’s being used plus 6 years for purposes of a statute of limitations on audit. If you bought a computer, keep the records for 3 years plus the additional six or nine years total. You may think this is overkill. Should you be audited, you will be glad you have the records.

Corporations (Sub-S and C) and partnerships: keep all records and tax returns from the date of inception until the corporation or partnership is closed plus a minimum of three years. Again, you may think this is overkill. Should you be audited, you will be glad you have the records.

Investments: Whether it’s real estate or stocks and bonds, you should keep all the information about how much the property cost you and when you bought it and any additional purchases and dates. This means keeping all those stock purchase slips.

If you own mutual funds and reinvest dividends and capital gains, keep the original purchase slips plus each year’s 1099’s in a mutual fund file so you can figure out the proper costs when you go to sell them. Brokerage and bank statements are invaluable when you go back to find something out.

If you own real property, keep your closing papers and proofs of payment as well as records of any improvements for as long as you own the property. If you sold a home before 1998, keep form 2119 until you’ve sold the replacement home.

Permanent files: Birth certificates, social security numbers, educational degrees, marriage licenses, divorce agreements, professional licenses, passports, wills, and copies of estate and gift tax returns should be kept permanently in a separate file. Sooner or later, you will need access to one of these documents. It makes life easier to know where it is.

“I don’t have to worry about getting my records, the store/bank/vendor will have them.” Ask now for how long any of these organizations will give you access to these records. Reason: I’m not sure that relying on someone else to keep your records is a good idea over many years. Same thing goes for what receipts you keep in your email.Are you sure you will be able to access your email for all the years it might be necessary? I would recommend that you either print them all to places you know are in your computer and have backups of that and/or download the paper copy and keep that.