RECORD RETENTION GUIDE – BUSINESS

CAUTION: IDENTITY THEFT IS A SERIOUS THREAT IN TODAY’S WORLD, AND IT IS IMPORTANT TO TAKE EVERY PRECAUTION TO AVOID IT.  AFTER IT IS NO LONGER NECESSARY TO RETAIN YOUR DOCUMENTS YOU SHOULD DISPOSE OF THEM BY SHREDDING THEM OR USE SOME OTHER METHOD AND DO NOT DISPOSE BY MERELY THROWING ANY RECORD AWAY IN THE TRASH.

Create a Backup Set of Records and Store Them Electronically

Record keeping

Keeping a backup set of your business records is easier than ever now since many financial institutions provide statements and documents electronically, and most financial information is available on the Internet.

Even if the original records are provided only on paper, they can be scanned and converted to a digital format. Once the documents are in electronic form, taxpayers can download them to a backup storage device, such as an external hard drive, or burn them onto a CD or DVD (don’t
forget to label it).

You might also consider online backup, which is the only way to ensure that data is fully protected. With online backup, files are stored in another region of the country, so that if a hurricane or other natural disaster occurs, documents remain safe.

Business Documents To Keep For One Year

• CORRESPONDENCE WITH CUSTOMERS AND VENDORS
• DUPLICATE DEPOSIT SLIPS
• PURCHASE ORDERS
• RECEIVING SHEETS
• REQUISITIONS
• STENOGRAPHER’S NOTES
• STOCKROOM WITHDRAWL FORMS

Business Documents To Keep For Three Years

• EMPLOYEE PERSONNEL RECORDS (FROM TERMINATION)
• EMPLOYMENT APPLICATIONS
• EXPIRED INSURANCE POLICIES
• GENERAL CORRESPONDENCE
• INTERNAL AUDIT REPORTS
• INTERNAL REPORTS
• PETTY CASH VOUCHERS
• PHYSICAL INVENTORY TAGS
• SAVING BONDS REGISTRATION RECORDS OF EMPLOYEES
• TIME CARDS FOR HOURLY EMPLOYEES

Business Documents To Keep For Six Years

• ACCIDENT CLAIMS & REPORTS
• A/P LEDGERS & SCHEDULES
• A/R LEDGERS & SCHEDULES
• BANK STATEMENTS & RECONCILIATIONS
• CANCELLED CHECKS
• CANCELLED STOCK & BOND CERTIFICATES
• COPPIES OF PURCHASE ORDERS
• EMPLOYMENT TAX RECORDS
• EXPENSE ANALYSIS & DISTRIBUTION SCHEDULES
• EXPIRED CONTRACTS & LEASES
• PAYROLL RECORDS & SUMMARIES
• PLANT COST LEDGERS
• SALES RECORDS
• SUBSIDIARY LEDGERS
• TIME BOOKS
• TRAVEL & ENTERTAINMENT RECORDS
• VOUCHERS FOR PAYMENTS TO VENDORS, EMPLOYEES, ETC.

Business Records to Keep Forever

Federal guidelines do not require you to keep tax records FOREVER; however, there may be some cases that you will want to retain these documents indefinitely.

• AUDIT REPORTS FROM CPA/ACCOUNTANT
• BILLS OF SALE
• CANCELLED CHECKS FOR IMPORTANT PAYMENTS
• CASH BOOKS
• CHARTS OF ACCOUNTS
• CONTRACTS/LEASES CURRENTLY IN EFFECT
• CORPORATE DOCUMENTS
• DEEDS
• DEPRECIATION SCHEDULES
• FINANCIAL STATEMENTS (YEAR END)
• FIXED ASSET ADDITION DOCUMENTATION
• GENERAL & PRIVATE LEDGERS
• INSURANCE RECORDS (CURRENT ACCIDENT REPORTS, CLAIMS & POLICIES)
• INVESTMENT TRADE CONFIRMATIONS
• IRS REVENUE AGENTS’ REPORTS
• JOURNALS
• LEGAL RECORDS & CORRESPONDENCE
• MINUTE BOOKS OF DIRECTORS/STOCKHOLDERS
• MORTGAGES
• PROPERTY APPRAISALS BY OUTSIDE APPRAISERS
• PROPERTY RECORDS
• RETIREMENT/PENSION RECORDS
• TAX RETURNS & WORKSHEETS
• TRADEMARK/PATENT REGISTRATION