There are no hard and fast rules, but there are some general guidelines out there for how long you should keep your biz records:
1 Year — Duplicate deposit slips, Purchase orders, Correspondence with customers & vendors
3 Years — Cancelled checks, Paid vendor invoices, Expired insurance policies, Employee payroll records
6 Years — Sales records & invoices, Bank statements, Auto mileage logs, Travel & entertainment records, Employment tax records
Forever — Copies of tax returns, Tax/legal correspondence, Contracts/leases, Real estate records, Corporate minutes & stock records
Generally, retention guidelines are the same for computerized records as for paper copies. But it’s important that you can retrieve what you need and that the IRS can access those records. In other words, your computerized records need to be upgraded if they’re in an obsolete format. And always remember to keep off-site backups!!
Deb Howard Greenleaf, EA, CEO and Principal, of Greenleaf Accounting Services provides virtual accounting and bookkeeping services and specializes in financial management to consultants, coaches, solo professionals, and other small business owners across the US. Deb is an Enrolled Agent (EA)—an IRS-licensed tax professional—and specializes in small businesses and entrepreneurs filing Schedule C or as an LLC. As an Advanced Certified QuickBooks ProAdvisor, Deb spends her day in QuickBooks Online and specializes in providing QBO support.
