How Long Do You Need To Keep Business Records?

Businesses face many challenges but the one you never want to have to face is having to rebuild your records due to some unforeseen event. Having solid backups of your records is a must otherwise you could find yourself wasting precious resources and man hours having to reconstruct everything you lost. In addition you might find that your records are needed by your bank, your state or even the IRS should a problem occur. The following is a list of records and how long you should keep them. Even if you are no longer in business. Some records need to be kept indefinitely. Records such as those of past employees may once in a while need to be dug out to help someone else. It could be that they have applied for a new job or unemployment benefits. You just never know what they might be needed for so don't get rid of them. Such records include: All corporation documents such as certificates of incorporation, your corporate charter, constitution and bylaws, minutes of board of directors meetings, deeds and easements, stock and stock transfer records, retirement and pension records, labor contracts, and license, patent, trademark and registration applications and any court documents or judgments. Financial documents that need to be saved indefinitely include income tax reports, annual financial statements, books of accounts, and income tax payment checks plus all documents relating to fixed assets owned by the company and depreciated over time. Some records only need to be kept for a six year period instead of indefinitely. Such records include: Sales records such as invoices, monthly statements, shipping papers, bills of lading and customers purchase orders. Company purchase records such as purchase orders and vouchers need to be kept. In addition you need to keep all travel records such as expense statements and receipts. Financial records that need to be kept include personnel and payroll records, such as payments and reports to taxing authorities, including federal income tax withholding, FICA contributions, unemployment taxes and worker's compensation insurance as well as all bank reconciliations, voided checks, and check stubs. And finally some records only need to be kept for the relatively short period of three years. These records include: Monthly and quarterly financial statements plus any subledgers you may have. It's not just a good idea to keep back up records it is a necessary part of doing business. You really can't afford to have something happen to such records. There are plenty of ways to keep back ups. Everything from stowing copies of your records in an off site storage to using a file management company. There is a solution out there that you can be happy with. Take the time to find it and then develop a process to regularly back up your files and store them for safekeeping. You might find that one day such a practice could literally save your business.



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