Most business owners don’t know how long they should hold on to old records. According to the IRS, here’s how long you should keep those records:
- general ledgers and journals
- payroll records, including W-2s, 940s, 941s
- year-end financial statements
- tax returns and supporting documents
- articles of incorporation, bylaws, meeting minutes, etc.
- retirement plan records
- mortgages and deeds
- bank statements and cancelled checks
- AP & AR documents
- invoices and billing information (customers and ventors)
- contracts with clients and suppliers
- expense reports
- employee agreements/contracts/termination records
- documents related to litigation
- inventory documentation
- employment applications
- employee disability and illness benefit records
- expired insurance policies
- general correspondence
This information is helpful but our favorite rule of thumb is to “save everything” and keep anything older than a few years in storage. Unless your business deals with mountains of paperwork, that method will be the easiest way to keep it simple and safe.
- Organize your documents by the various categories above.
- Scan copies of the critical documents and place them in a free Dropbox account which will keep your files safe and backed-up “in the cloud” (Free up to 2GB of data)
- If you are a Corporation or LLC, then also make sure that you are complying with record-keeping, minutes and annual reports. Click here to learn about our ComplianceLock™ service which can automate these tasks.