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Here are some of the standard limitation periods on tax-related documents, according to the IRS:
 

  • If you owe additional taxes, keep records for 3 years

  • If you do not report income that should have been reported, and it exceeds 25% of the gross income on your return, keep records for 6 years

  • If you file a fraudulent return, keep records indefinitely

  • If you do not file a return, keep records indefinitely

  • If you file a claim for credit or refund after filing your return, keep records for 3 years from the filing of the original return

  • If you file a claim for a loss due to bad debt deduction or worthless securities, keep records for 7 years

  • Keep all employment records for at least 4 years after the tax is due or paid


Some business records should be kept permanently:
 

  • Audit reports and charts of accounts

  • Canceled checks for important payments

  • Records of capital stocks and bonds

  • Cash books

  • Contracts and leases still in effect

  • Legal correspondence

  • Deeds, mortgages, bills of sale

  • End of year financial statements

  • Insurance records

  • Minutes, bylaws and charters

  • Property appraisals and records

  • State and federal income tax returns

  • Trademark registrations


Other records are commonly kept only up to seven years:
 

  • Accident reports and claims

  • Ledgers and schedules for accounts payable and receivable

  • Bank statements

  • Most canceled checks

  • Expired contracts and leases

  • Product, material and supply inventory

  • Customer and vendor invoices

  • Ledger and schedules for notes receivable

  • Option records

  • Payroll account records

  • Purchase orders

  • Sales records

  • Canceled stock and bond certificates

  • Vouchers


For more information about business taxes, go to
www.irs.gov.

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.


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