How long should one keep tax documents?

[question everything]

We have all our tax returns and supporting documents going back now for over 25 years.

Some "experts" say seven years; others say forever..

I just looked at our very first one. You cannot even read what is on the W-4 form! I think that they were thermal paper.

We even have all the papers associated with buying and selling three previous homes...

[DrDan]

1. I just went back through all my tax records - back to the

late 60's

I decided to keep all the returns . . .

and the supporting docs for everything from the 90's on . . .

I thought this would be safe.

[A HERETIC I AM]

2. Here is what the IRS website says;

The length of time you should keep a document depends on the action, expense, or event the document records. Generally, you must keep your records that support an item of income or deductions on a tax return until the period of limitations for that return runs out.

The period of limitations is the period of time in which you can amend your tax return to claim a credit or refund, or that the IRS can assess additional tax. The below information contains the periods of limitations that apply to income tax returns. Unless otherwise stated, the years refer to the period after the return was filed. Returns filed before the due date are treated as filed on the due date.

Note: Keep copies of your filed tax returns. They help in preparing future tax returns and making computations if you file an amended return.

You owe additional tax and situations (2), (3), and (4), below, do not apply to you; keep records for 3 years.
You do not report income that you should report, and it is more than 25% of the gross income shown on your return; keep records for 6 years.
You file a fraudulent return; keep records indefinitely.
You do not file a return; keep records indefinitely.
You file a claim for credit or refund* after you file your return; keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later.
You file a claim for a loss from worthless securities or bad debt deduction; keep records for 7 years.
Keep all employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.
The following questions should be applied to each record as you decide whether to keep a document or throw it away.

The rest at:
http://www.irs.gov/businesses/small/article/0,,id=98513,00.html

Hope that helps

on edit to add IRS Pub 1035 which discusses Statute of Limitations.

http://www.irs.gov/pub/irs-pdf/p1035.pdf

[question everything]

3. Thank you very much for the link

Funny that one "consideration" is if you filed a fraudulent return.