Here you’ll find some up-to-date tips on dealing with your business tax requirements.

Retention of Records

Each entity must maintain records that meet the requirements for historical, tax and general purposes.  The following is a summary that may be helpful in deciding what to retain and for how long.

For Historical and General Purposes: 

Accounts payable invoices, earnings registers, voucher

checks, travel expense reports and supporting documentation - 3 Years

Accounts receivable ledgers, bank deposits, bank statements,

budgets, payroll checks and supporting documentation - 3 Years

Purchase orders, requisitions, and contracts - 3 Years

Publications, newsletters, meeting handouts, etc. - 3 Years

Projects, workpapers and procedures - 10 Years

Articles of Incorporation - Permanently

Bylaws - Permanently

Minutes of Meetings (Board as well as Committees) - Permanently

Prepared Tax Returns - Permanently

Payroll Earnings Records - Permanently

General Ledgers and Journals - Permanently

Financial Statements - Permanently

Fixed Asset Records - Permanently 

For Tax Purposes

Records of property must be kept until disposition is made so the basis, depreciation or amortization, and gain or loss can be calculated.  After disposition, the record retention rules for records of income, deductions, and credits will apply.

Records of income, deductions, and credits (including gains and losses) appearing on a return should be kept, at a minimum, until the statute of limitations for the return expires which is 3 years after the return is filed or 2 years after payment, whichever is later.  Retention of records will increase to a 6 year period if there has been a substantial omission of income and a 7 year period applies for filing a claim for a credit or a refund relating to bad debts or losses on securities.

There is no statutory period if fraud is established or if no return was filed.  If a return is not required, you may want to file a return to cause the statute of limitations to be in effect.