Keeping
corporate records is important for many reasons, least of all, tax fraud. Without
corporate records showing legitimate depreciation amounts and expenses, officials could accuse a corporation of fraud following a tax audit.
Corporate tax records should be kept at least as long as the longest depreciation time. If the corporation takes depreciation on a certain item for seven years, tax records should be kept for at least seven years. Corporations should also file tax records by year, so that they are easier to find in the event of an audit.
The corporation should also keep all
meeting minutes. If the IRS suspects any type of tax fraud, it can request
meeting minutes to make sure that the corporate resolutions agreed to by the officers and shareholders are the same as what the corporation has been physically doing over the years (during the audit period).