What document retention procedures should I follow (for my business and personal tax returns)?

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/How-long-should-I-keep-records

 

  • You owe additional tax and situations (2), (3), and (4), below, do not apply to you; keep records for 3 years.

  • You do not report income that you should report, and it is more than 25% of the gross income shown on your return; keep records for 6 years.

  • You file a fraudulent return; keep records indefinitely.

  • You do not file a return; keep records indefinitely.

  • You file a claim for credit or refund after you file your return; keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later.

  • You file a claim for a loss from worthless securities or bad debt deduction; keep records for 7 years.

  • Keep all employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.


    Bottom line: Keeping records for six years (unless one of the above relates to you), after filing your tax return, should keep you in the clear.

    Note: We try to retain at least five years or past returns we have completed for clients. We also try to scan and retain any client documents for the years retained.

    YOU ARE RESPONSIBLE FOR RETAINING YOUR OWN DOCUMENTS. WE CANNOT BE SOLELY RELIED UPON TO PROVIDE DOCUMENTS TO THE IRS IN CASE OF AUDIT OR OTHER EXAMINATION. IF POSSIBLE, AN ELECTRONIC COPY AND PAPER COPY IS RECOMENDED FOR ADDITIONAL SAFE KEEPING.

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