Never heard of 7 years. For nearly everyone, 3 years is right. The 6 year statute of limitations is for an understatement of income of 25% or more. Over 32 years and around 11,000 returns, never had the 6 year statute come up, 3 years was always the applicable deal.
If there is anything impacting a return that comes from the past, you can still need to provide support. For example, if you bought a commercial building 25 years ago and you are still deducting depreciation on that building, you could have to provide proof of your basis of that building. Don't need that 25 year old tax return, but the settlement statement and any costs over and above those shown thereon would be needed.
And it isn't the tax return itself so much as the underlying documents that you need in case of an audit, the IRS has the return, just not the support. And those documents typically take up much more room that the actual return itself.
Something I ran into more than a few times involves casualty losses (fire, hurricane, etc.). When you toss old tax records (bank statements, receipts, etc.) for a tax year, you will be tossing many things that do not have any tax implications, but could be a source for filing an insurance claim. Not only proof of what you paid for something, but a reminder of what things you lost but did not initially think of. This came into play when the loss was pretty much total, everything gone. Of course, you have to store those records somewhere other than the house, or in something fireproof. I will never forget this one gal who had damage from a flood. As I recall, she was able to prove up like $164,000 for contents, and nothing she had was what I would call pricey (no $10,000 shotguns or artwork). In fact, her contents were a lot more than they had originally paid for the house.