How Long to Keep Records?
I get asked one difficult question frequently. How long do I have to keep my records? Depending on the size and type of your business you might have to pay storage fees or send them to a government agency. Important records aren’t only needed by the IRS. You have OSHA, SEC, EEOC, and others. Going out of business can even be an exhausting experience. I always tell clients to use caution before disposing of records.
I’m going to run down a list of some records and how long I recommend you keep them. This list is not definite as rules change and states can have different time requirements. This list might not work for everyone, but take a look. There are electronic storage options that reduce the clutter of having paper records. Going paperless is saving trees, but can help with your record keeping requirements.
Permanent
Any Legal Contracts – Keep permanently
Annual Financial Statements – Keep permanently
Asset Ledgers and Depreciation Schedules – Keep permanently
Audit Reports – Keep permanently
Documents for major asset purchases – Keep permanently
Employee Medical Records related to exposure of toxic substances – Keep permanently
Entity Structure/ Organizational Documents – Keep permanently
Insurance Policies workers comp, life- Keep permanently
Intangible Asset Records- Keep permanently
Tax Records Income tax returns, income documents like 1099’s, W-2’s, etc. – Keep permanently regardless of what the IRS says
Wills and Trust- Keep permanently
Long Term
Employee Accident Documents after a settlement – 11 years
Employee Procedures Manual – 11 years
Employee Job Descriptions – 11 years
Workers Compensation Documentations – 11 years
Bank Statements – 7 years
Check Ledger – 7 years
Customer & Vendor Invoices -7 years
Inventory Records -7 years
Payroll Checks- 7 years
Personnel Files after termination – 7 years
Sales Records- 7 years
Subsidiary Ledgers for A/R, A/P etc. – 7 years
Time Cards- 7 years
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