Record Retention Periods
Tuesday, May 31, 2016

Retaining and storing your income tax records is an important final step of your tax filing responsibility. This should serve as a refresher on the rules for keeping your tax records.

The general rule for retaining records is that such books and records must be kept as long as they may be relevant to your claim for a tax credit or refund, or to an Internal Revenue Service attempt to assess additional tax for the year in question.  We recommend the following document retention periods as general guidelines.  In some cases, the retention period recommended may be for non-tax reasons, for example, real estate records should be kept forever for environmental liability exposure reasons among others.

         Type of Record                                                                Retention Period
Copies of tax returns as filed
Tax and legal correspondence
Audit reports
General ledger
Annual financial statements
Contracts and leases  
Real estate records
Corporate stock records and minutes
Bank statements and deposit slips
Sales records and journals
Payable and receivable journals
Other records relating to revenue
Employee expense reports
Canceled checks
Paid vendor invoices
Employee payroll expense records
Inventory records
Depreciation schedules
Other capital asset records
Other records relating to income/expenses
Partnership agreement
Operating agreement (LLC)
Forever
Forever
Forever
Forever
7 years
7 years after end of contract
Forever
Forever
7 years
7 years
7 years
7 years
7 years
7 years
7 years
7 years
7 years
7 years
Tax life of asset plus 4 years
Tax life of asset plus 4 years
7 years
Forever
Forever

We hope this brief overview helps you understand the income tax record retention periods. If you have any questions regarding the above retention periods, please do not hesitate to give us a call.

Thank you,