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How Long To Keep Records – Personal and Business

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This record retention schedule will guide you how long to keep records for all manners of receipts and paperwork for taxes. Organized by length of time to keep records OR title of documents.

At one point or another in your life, the IRS is going to send a letter asking for updated forms or for you to fix a mistake in your tax return. Having access to the required records will make your response and updated forms infinitely easier to deal with. I’m fanatically organized when it comes to taxes, and it happened to me. Funny enough, I was threatened with a fine if I didn’t respond promptly with the appropriate fix which would have netted me a larger refund. Anecdote aside, this guide will provide you with an outline on how long you will need to keep all manners of receipts and records.

This record retention schedule has been checked and verified by a California based CPA, Tennessee based CPA, and California based estate planner.

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how long to keep records retention

Recommended Record Retention Periods for Personal Records

record retention personal taxes

In Retention Period Order

Permanent Records

  • Birth certificates
  • Correspondence – Legal and important matters
  • Custody agreements
  • Death certificates
  • Divorce papers
  • Employment taxes for household employees (records and returns)
  • Existing insurance records
  • IRA contributions
  • Marriage certificates
  • Retirement and pension records

Two Years

  • Bank reconciliations
  • Duplicate deposit slips

Four Years

  • Insurance policies which have expired

Six Years

  • Bank statements
  • Credit card statements

Seven Years

  • Canceled stock and bond certificates
  • Home and home improvements – including closing papers, purchase and sales invoices, proof of payment, insurance papers, Form 2119
  • K-1’s from partnerships, trusts, S-corps

Recommended Record Retention Periods for Personal Records

In Alphabetical Order

Bank reconciliationsTwo Years
Bank statementsSix Years
Birth certificatesPermanent
Canceled stock and bond certificatesSeven Years
Correspondence – Legal and important mattersPermanent
Credit card statementsSix Years
Custody agreementsPermanent
Death certificatesPermanent
Divorce papersPermanent
Duplicate deposit slipsTwo Years
Employment taxes for household employees (records and returns)Permanent
Existing insurance recordsPermanent
Home and home improvements – including closing papers, purchase and sales invoices, proof of payment, insurance papers,

Form 2119

Seven Years
Insurance policies which have expiredFour Years
IRA contributionsPermanent
K-1s from partnerships, trusts, S-corpsSeven Years
Marriage certificatesPermanent
Retirement and pension recordsPermanent

RECOMMENDED RECORD RETENTION PERIODS FOR BUSINESS RECORDS

record retention business taxes

In Retention Period Order

Permanent Records

  • Appropriate ledger and related end of year trial balances
  • Cancelled checks for payment of taxes, purchase of property, and in payment of important contracts should be retained permanently with the papers in these files
  • Capital stock and bond records:
  • Ledgers, transfer registers, stubs showing issues and record of interest coupons Cash books (receipts and disbursement journals)
  • Deeds, mortgages, and bills of sale, contracts and leases in effect
  • Depreciation schedules
  • Employment taxes (records and returns, including withholding statements)
  • Financial statements – Year end (others optional)
  • General and private ledgers, and related end of year trial balances Insurance records (existing)
  • Minute books of directors and stockholders, by-laws
  • Patents and related papers
  • Property appraisals by outside appraisers
  • Property ledgers – including costs, depreciation reserves and end of year trial balances Tax returns and worksheets, Revenue Agent’s reports and other documents relating to determination of tax liability Trade mark registrations

One Year

  • Correspondence of unimportant nature with customers or vendors
  • Purchase orders (except purchasing department copies)
  • Receiving sheets
  • Requisitions
  • Stenographers’ note books Stockroom withdrawal forms

Three Years

  • Employment applications
  • General correspondence
  • Internal audit reports, including working papers
  • Miscellaneous internal reports
  • Petty cash vouchers
  • Physical inventory tags

Four Years

  • Insurance policies which have expired

Seven Years

  • Accident reports
  • Accounts receivable ledgers and related trial balances
  • Bank reconciliations
  • Bank statements
  • Canceled checks (see exception under permanent records) Contracts and leases expired
  • Duplicate deposit slips
  • Expense analyses and expense distribution schedules
  • Garnishments
  • Inventory summaries of product, materials and supplies
  • Invoices to customers and from vendors
  • Journal vouchers
  • Notes receivable ledgers and related trial balances
  • Payroll records and summaries, including payments to pensioners
  • Personnel files (terminated)
  • Purchase orders (purchasing department copies)
  • Sales records
  • Scrap salvage records
  • Inventories, sales, etc.
  • Subsidiary ledgers to the general ledger and related trial balances
  • Time books
  • Voucher register and related trial balances

RECOMMENDED RECORD RETENTION PERIODS FOR BUSINESS RECORDS

In Alphabetical Order

Accident reportsSeven Years
Accounts receivable ledgers and related trial balancesSeven Years
Appropriate ledger and related end of year trial balancesPermanent
Bank reconciliationsSeven Years
Bank statementsSeven Years
Canceled checks (see exception under permanent records)Seven Years
Canceled checks for payment of taxes, purchase of property, and in payment of important contracts should be retained permanently with the papers in these filesPermanent
Capital stock and bond records:
Ledgers, transfer registers, stubs showing issues and record of interest coupons
Permanent
Cash books (receipts and disbursement journals)Permanent
Contracts and leases expiredSeven Years
Correspondence of unimportant nature with customers or vendorsOne Year
Deeds, mortgages, and bills of sale, contracts and leases in effectPermanent
Depreciation schedulesPermanent
Duplicate deposit slipsSeven Years
Employment applicationsThree Years
Employment taxes (records and returns, including withholding statements)Permanent
Expense analyses and expense distribution schedulesSeven Years
Financial statements – Year end (others optional)Permanent
GarnishmentsSeven Years
General and private ledgers, and related end of year trial balancesPermanent
General correspondenceThree Years
Insurance policies which have expiredFour Years
Insurance records (existing)Permanent
Internal audit reports, including working papersThree Years
Inventory summaries of product, materials and suppliesSeven Years
Invoices to customers and from vendorsSeven Years
Journal vouchersSeven Years
Miscellaneous internal reportsThree Years
Minute books of directors and stockholders, by-lawsPermanent
Notes receivable ledgers and related trial balancesSeven Years
Patents and related papersPermanent
Payroll records and summaries, including payments to pensionersSeven Years
Personnel files (terminated)Seven Years
Petty cash vouchersThree Years
Physical inventory tagsThree Years
Property appraisals by outside appraisersPermanent
Property ledgers – including costs, depreciation reserves and end of year trial balancesPermanent
Purchase orders (except purchasing department copies)One Year
Purchase orders (purchasing department copies)Seven Years
Receiving sheetsOne Year
RequisitionsOne Year
Sales recordsSeven Years
Scrap salvage records – Inventories, sales, etc.Seven Years
Stenographers’ note booksOne Year
Stockroom withdrawal formsOne Year
Subsidiary ledgers to the general ledger and related trial balancesSeven Years
Tax returns and worksheets, Revenue Agent’s reports and other documents relating to determination of tax liabilityPermanent
Time booksSeven Years
Trademark registrationsPermanent
Voucher register and related trial balancesSeven Years

Tips on Organizing Your Paperwork

Making the effort to get organized and cohesively consistent supplies up front is helpful psychologically and can provide strong visual cues when organizing.

The cornerstone of my organization is in a vertical filing cabinet. I use a 4 drawer filing cabinet, but a 3 drawer would work as well for my methods. One drawer holds everything related to the house, from appliances to house-related bills such as energy or internet. The second drawer is for all business related paperwork. The third is for all personal related paperwork. The four is a miscellaneous file for things that are specific to me as a person, such as gardening notes or pamphlets with inspirational graphic design.

For current documents stored in the filing cabinet, I use a combination of hanging file folders in different colors based on the content category as well as washi tape for quick relabeling or notes inside the folder.

I archive paperwork over a year old. Once a year, right after I finish taxes, I go through my files and place everything from the prior year, from personal to business, into a manilla folder with the year and contents written on the tab. Each year gets its own box, which then goes into storage into the garage. I have 11 weathertight plastic boxes which protect from moisture and dust. Inside each box is a silica packet to absorb moisture and keep papers from molding over the next 10 years. These color changing packets provide a visual cue if there is too much moisture in the box and can be “recharged” which is super nice.

The 11th is for permanent documents that I will never purge. The other 10 boxes have a scrap piece of paper inside with the year facing outwards for me to quickly see which year I am handling. I shred the 10th year and replace its contents with the current year I am archiving. After several years of this, my system has worked pretty nicely and seamlessly.

I actually ignore most of the year guidance on my schedule and keep things for either 1 year or 10 years. I have a lot of paperwork and it just makes my time and energy simpler. For people with less paperwork or less room than I have, purging as recommended will save a ton of space. I could probably minimize down to 3 or 4 boxes total if I was diligent about taking my own advice.

How do you organize your files that you need to save?

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