Thank you for your great question about B12. It is true that many supplements contain B12 because of its impressive benefits for the brain, nerves and energy/metabolism. However, as you point out it is important to consider possible downsides of taking too much of any nutrient.
You are correct in stating that B12 is water soluble. This reduces it’s potential for toxicity because it can be easily flushed by the body but does eliminate all risk. For example, vitamin B6 is also water soluble but if taken at too high of a dose (typically over 150mg/day) for extended periods of time it can cause some temporary nerve damage in certain individuals. Unlike B6, B12 has never been shown to have any potential for toxicity. Although it is stored in the body more so than other B-vitamins, its potential for toxicity is non-existent. Some people who are sensitive to B12, or are taking high doses as injections may experience temporary issues with insomnia or feeling “wired” because of its beneficial impact on metabolism.
As a measure of its low toxicity and safety, the US Food and Nutrition Board has not set any upper tolerable intake levels for B12. To my knowledge there is no credible evidence to suggest any detrimental impact on the liver from taking B12, even in high doses for extended periods of time, or correlation to promoting tumor growth.
Adults can safely take 1,000mcg-5,000mcg daily for extended periods of time, so your current dose is within generally recognized safety limits. Higher amounts may be indicated for certain people with different health concerns. I typically recommend people take the methylated form of B12 (methylcobalamin) because it is more bio-active and typically yields better clinical results.
You also might want to consider asking your doctor for a simple B12 blood test. If you have been taking B12 for a while it might show that your blood B12 levels are elevated. If this is the case, it is nothing to be concerned about but may indicate that you can take a break from this aspect of your supplement regimen for a while.
At the end of the day, there is very little to worry about when it comes to taking B12. No significant evidence exists to date that indicates long term supplementation (even with doses well above the RDA) has any toxicity or side effects. This cannot be said about all nutrients and vitamins but it is the case this b-vitamin.