According to the Internal Revenue Service (IRS), the amount of time you must preserve records about your taxes depends on the "activity, cost, or event" that affected those records. These activities, as well as the timescales involved, are essential because they affect the statute of limitations that applies to any adjustments that may be made to your tax return, as well as the federal government's power to seek extra tax payments from you.

The statute of limitations governs the time the Internal Revenue Service (IRS) has to assess further tax or the amount of time you have to revise your tax return to claim a credit or refund. The following information comes from IRS.gov and details how long tax returns should be kept once filed. The years in question start counting once the tax return is sent in. Because this task cannot be completed at the branch level, some financial institutions include expenses for searching and printing in the cost of this service. Any tax returns sent in before the deadline are counted as having been handed in on the deadline itself.

• If the circumstances described in (4), (5), and (6) below do not apply to your case, you are required to keep records for three years.
• For two years beginning on the date that you paid the tax, whichever occurs later.

When You Need the Records

Roughly two-thirds of American adults now do financial transactions online via a mobile banking app or desktop computer. However, more than half of people still choose to get their bank and credit card statements in the mail. It should be no surprise that elderly customers are far more inclined to choose printed documents. Even while such paperwork is not present for purchases made online, there is still a possibility that seeing the real piece of paper you signed would provide some pleasure.

The paper may be safely shredded and thrown away after one year, with one significant caveat: anything that records a tax deduction has to be maintained for at least three years after the deduction has been claimed. The Internal Revenue Service (IRS) states that it conducts audits very seldom and rarely goes back further than that; yet, it maintains the right to do so. If you have an online banking account, the data will either be preserved online or made accessible to you via a special request placed with the bank or another financial institution. For example, American Express maintains online and searchable records of account transactions for three years' worth of activity. Customers of Chase Bank get access to the last seven years' account activity.

Reason You Should Keep the Statements

It would help if you routinely went through the activity in your bank account for any signs of identity theft or fraudulent debit card use. These declarations are utilized to collect any damages and offer documentation of any illegal behavior that may have occurred.

For Taxation

When you file your taxes, you may need to refer to your bank statements to verify your income and expenditures, such as the donations you made to charitable organizations and the expenses you incurred for your company. Statements from your bank account that validate major purchases or payments should also be kept for your records. For instance, if you want to make a claim on your insurance or utilize your warranty, you may require evidence of purchase. After you have checked that the receipts from your automated teller machine (ATM) match your account's data, you may destroy them. Once the transactions on the deposit and withdrawal slips have been confirmed with the monthly statement, the slips may be destroyed.

Statements Available Both Online and in Hard Copy

The monthly client statements of many banks are kept online for at least five years, and customers may quickly and easily access them using such institutions' online banking applications and websites. Typically, formats for printing out these statements are provided. Downloadable summaries of the information associated with transactions are routinely made accessible.

Your bank may be able to provide you with paper copies of your bank statements dating back a good number of years. Because this task cannot be completed at the branch level, some financial institutions include expenses for searching and printing in the cost of this service. The back office is where the handling of older statements takes place.

Shredding Documents

Rather than taking up time to manage your documents, it could seem more convenient to store them away indefinitely. However, this is not a good idea for several reasons, the most significant being the possibility that identity thieves would get them.