Under-reported income
We’re not saying you did it, but if you thought of under-reporting your income by 25 percent or more or file a fraudulent return and you’re caught by the IRS, you better be able to show the supporting documents and records for the audit. Parent warns the IRS will probably ask you for the supporting documents in the last seven years.
Where should I keep all this paperwork?
Living in the digital era has simplified many things in our lives. This is also the case with IRS related documents. Therefore, if you have tax documents in digital format, you will be glad to know that you can get rid of the paperwork boxes, as digital documentation is considered legally valid and binding as the originals.
Gonzalez says it’s best to archive important documents on your computer. “For those that you can find online, such as different forms from banks or other financial institutions, it’s best you download and save them. To keep things well organized, you should have a tax folder with all pertinent documents on your computer, as well as a backup somewhere else.” Also, to save some hard-drive memory, Parent recommends saving your documents as PDF files instead of screenshots of the documents which take up a lot of RAM.
