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
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.