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Business Record Retention
There are a few important items to note. First, there is no time frame for the IRS to pursue fraud. Fraud is defined as underreporting greater than 25% of your income in a year. Certain businesses have longer retention periods than others—such as Chiropractors.Be sure to investigate whether your profession has special record retention requirements, either by regulation or for insurance purposes. Papers should be shredded, not thrown away. Permanent Retention • Year-end Financial Statements • Cumulative general ledgers • Corporate Tax returns- federal and state • Cancelled checks for important purchases • Corporate minutes, Articles of Incorporation, and stock certificates • Important contracts or leases • Important legal correspondence • Deeds, escrow statements, titles and mortgages • Insurance records • Property Appraisals • Property records • Trademark registrations • Confirmation slips for investment purchases still owned • Year-end investment reports • Year–end Pension Reports Ten Year Retention Copies of checks made out to Illinois Department of Revenue Seven Year Retention • Accident reports and claims for settled cases • Accounts payable and Receivable ledgers and schedules • Canceled stock and bond certificates • Expired contracts and leases • Income and Expense ledgers • Expired option records • Inventory worksheets and schedules • Customer & Vendor Invoices • Notes Receivable Ledgers • Payroll records and tax returns • Royalty computations • Sales records and sales tax returns • Business Record Retention • Scrap and salvage records • Subsidiary ledgers • Payroll Time sheets • Bank statements and cancelled checks (if provided) • Expired insurance policies • Financial schedules and worksheets • Monthly investment reports Three Year Retention • Excise tax computations • General Correspondence • Employment applications • Expired insurance policies • Internal reports • Petty cash vouchers • Physical inventory tags Two Year Retention Proxies of voting security holders |
