For an update on this article, check out "What tax paperwork do you need to keep--and what to do with the rest"

Are you drowning in tax paperwork? Once tax season ends, do you dread finding room for yet another fat folder in an overstuffed closet, file cabinet or shelf? The IRS says all those stored papers may be overkill.

For the most part, you only have to keep your tax records for three years. So throw out all those folders from 1997.

Records you should keep include any and all documents that might have an impact on your federal return, including bills; credit card and other receipts; invoices mileage logs (for a home business, trips to health-care providers and volunteer work); canceled, imaged or substitute checks; proofs of payment; and any other records that support your claimed deductions or credits.

The IRS doesn't care what form those records take, so you could scan papers and keep them in secure electronic files on your computer desktop or external hard drive.

There are exceptions to the three-year rule. Keep some documents longer, including those related to home purchases, stock transactions, IRA and business/rental property income and expenses. Check IRS Publication 552, Recordkeeping for Individuals, for more on what records to keep.

And if you're wondering how to go paperless with your tax materials or other parts of your financial life, check out Consumer Reports Money Adviser's report, "Should you go paperless?"