Understand U.S. record keeping requirements for taxes, exports, healthcare, and employment. Learn retention rules from IRS, BIS, GIPS, OSHA, and EEOC - and how to avoid costly penalties.
IRS Record Retention: How Long to Keep Crypto Tax Docs
When it comes to IRS record retention, the rules for keeping tax documents apply just as strictly to cryptocurrency as they do to stocks or cash income. Also known as tax record keeping, this isn’t optional—it’s the difference between a smooth audit and a costly surprise. The IRS doesn’t care if your crypto came from a Coinbase trade, a DeFi yield farm, or airdropped tokens. If you made a gain, sold, traded, or earned it, you need proof.
Most people think they can delete wallet screenshots or exchange statements after filing their return. That’s a mistake. The IRS requires you to keep crypto tax records, including transaction histories, trade confirmations, and cost basis calculations. Also known as digital asset documentation, these files prove you didn’t underreport income. For crypto, this means saving every single trade, swap, staking reward, and gas fee. You need the date, amount, value in USD at the time, and what you received or sent. No estimate. No memory. No ‘I think it was around $300’—that won’t fly.
How long? IRS record retention for crypto is six years if you underreported income by more than 25%, and seven years if you claimed a loss from worthless crypto. For most people, keeping records for at least three years after filing is the bare minimum—but six is safer. Why? Because the IRS can go back six years if they suspect fraud. And yes, they’ve started auditing crypto users. In 2023, they sent out over 10,000 crypto-related audit letters. They’re not guessing—they’re matching exchange data with your returns.
What counts as proof? A CSV from Binance, a Ledger export, a Koinly report, or even a manually logged spreadsheet with timestamps. Just don’t rely on your exchange’s website alone—those records can disappear if the platform shuts down. Save your files offline. Use encrypted drives or printed copies. If you used a decentralized exchange like Uniswap, you need your wallet transaction hashes and Etherscan exports. No blockchain explorer link is enough. You need the actual data.
And don’t forget gifts, donations, or lost keys. If you sent crypto to a friend as a gift over $18,000, you need to file Form 709. If you lost access to a wallet with $50,000 in BTC, you need documentation to claim a theft loss—even if the IRS makes it hard. The rules are clear: if you can’t prove it, the IRS assumes you made a gain.
There’s no magic tool that auto-saves everything for you. You have to build the paper trail yourself. That’s why the best crypto investors treat record retention like a daily habit—not a year-end chore. Set up a folder. Name it clearly. Back it up. Update it after every trade. It’s not glamorous, but it’s the only thing standing between you and a $10,000 penalty.
Below, you’ll find real cases where people lost money not because their crypto crashed—but because they didn’t keep the right records. Some of these stories involve fake coins, dead exchanges, and airdrops that vanished. If you’re trading crypto, you’re already in the tax system. The question isn’t whether the IRS knows—you need to know if you’re ready for them.