Documents to Retain

[drdino]

I have a totally paperless office. Everything scanned and stored in three places including a commercial storage service.

My question. I read in an earlier post about retaining W2 and other 1099 info. Is this true? Is this a requirement for the Preparer? I stopped this a while back and keep just the completed copy of the return electronically with 8879.

I understand that some people save everything and others like myself are bare bones, but Id like to know what the requirement is. A quick search has come up 50-50 yes and no.

Thanks in advance.

[solomon]

http://www.irs.gov/pub/irs-pdf/p1345.pdf

[ttbtaxes]

Page 30

Take a look at the bottom of page 30.

[ttbtaxes]

Pub 1345

Yes you can. Take a look at the bottom of page 30.

[Super Mom]

I've always thougt that when I enter the W-2 and the 1099-R etc., in my tax software, that counts as a copy of that form, should I be keeping the actual original that would ordinarily go to Federal?

[gkaiseril]

and...

A tax preparer would never mistype.

A tax preparer would never be given a fraudulent W-2.

A client will alsways bring in a corrected W-2.

If you send in a W-2 always keep a phoocopy of the W-2 and any signed doucments.

[ttbtaxes]

I read Pub 1345 and it appears to me that we have to keep a copy of all W-2s and 1099s. The Pub goes on to describe that the copy must be clear and we must be able to reproduce them if requested. So, I'd say a photocopy or a digital scanned copy is required.

I don't believe that was ever required with a paper-filed return.

[BP.]

and...

A tax preparer would never mistype.

A tax preparer would never be given a fraudulent W-2.

A client will alsways bring in a corrected W-2.

If you send in a W-2 always keep a phoocopy of the W-2 or a a scan of the W-2.

Uh-huh. Would also like to show proof it is the correct yr's form. I've had some rejects for mistyped EIN's over the years, and having the orig was crucial to making an easy correction.

[rgtaxservice]

...

I was always aware of the documentation retention requirements for efiled returns via 1345, but I've never read anywhere about preparer requirements to retain paper-filed documents.

[ChEAr$]

Check the publication again, but as I remember one must keep W2, 1099R, SSA1099, etc on which any federal withholding appears.
Thus not necessary to retain copy b of a W2 with no witholding.

And one reason information entered onto a W2 screen in the software does not count as a copy is that most preparers do not enter every piece of information.

[Jack the Tax Lady]

I believe there may be confusion

Check the publication again, but as I remember one must keep W2, 1099R, SSA1099, etc on which any federal withholding appears.
Thus not necessary to retain copy b of a W2 with no witholding.

And one reason information entered onto a W2 screen in the software does not count as a copy is that most preparers do not enter every piece of information.

I believe there is confusion between paper filed and e-filed returns.

With e-filed returns, you must retain copies of w-2s, 1099s, etc., withholding or not.

With paper filed returns, you must ATTACH copies of all w-2s, withholding or not. You do not attach 1099's, etc unless there is withholding. Preparers do not need to keep copies of those forms when paper filing.

There is best practice, there is tradition, and there is requirement. There is a difference.

[gkaiseril]

A little off topic, but if you need to supply any original douments to the IRS, a state, etc, keep a photocopoy and note as to who the original was provided and a copy of the agencies request.