How Long Do I Legally Have to Keep Old Records?

Files_300An area of major confusion is record retention for businesses and individuals. You should consult with your attorney and/or CPA but our general guidelines are:

Accounting and Tax Records

The length these items are kept is governed by the IRS rules. The IRS can audit a tax return for three years after the date it was due or the date the tax was paid; whichever is later. If they find an understatement of income, the IRS can audit six years after the due date. For that reason, most CPA’s recommend keeping all tax records at least seven years but a permanent record is the best practice.

Electronic Records Keeping

As long as records can be legibly reproduced, electronic filing of documents is acceptable for most documents.

Corporate Records

Corporate documents must be kept indefinitely. This would include the Articles of Incorporation, bylaws, stock records and board of director minutes.

Personnel Records

Personnel records are required to be kept for the length of a person’s employment plus six years after their termination.

For a list of Guidelines for Record Retention, click here.