The IRS dictates you must keep your records as long as they may be needed to prove the income or deductions on a tax return. For example, determining gain or loss on a sale or disposal of an asset, you will need to substantiate the cost, so records and receipts related to that asset must be kept as long as asset is still in service and then add 3 years. Other state or regulating agency requirements may apply. In general, you should keep records as follows:
1 Year:
Purchase Orders
Bank Reconciliation's
Stockroom Withdrawal Slips
Requisitions
Bank Deposit Slips
Receiving Sheets
2 Years:
Employment Applications
Personnel Employee Time Cards, Rating Cards, & Job Descriptions
Internal Reports
Physical Inventory Tags
Correspondence
Petty Cash Slips
Insurance Policies
Travel Expense Reports
3 Years:
Accounts Payable Invoices
Bank Statements
Expense Reports
5 Years:
Internal Audit Reports
Excise Tax Computations
7 Years:
Canceled Checks
Purchasing Department Copy of Purchase Orders
Scrap and Salvage Records
Sales Records
Payroll Records and Related Documents
Canceled Stock and Bond Certificates
Accounts Payable Ledgers
Accounts Receivable Ledgers
Customer Invoices
Vendor Invoices
Subsidiary Ledgers
Time Cards
Vouchers for Payments to Vendors
Inventory Records
Expense Analysis Schedules
Contracts and Leases
What To Keep Forever:
Deeds/Mortgages
Credit History
Check Registers
Cash Ledgers
Property Appraisals
Contracts and Leases
Contracts
Incorporation Records
Insurance Policies
Patent, Trademark & Copyrights and Related Material
Accountants’ Reports
Canceled Checks/Bills of Sale for Large and Important Purchases
Insurance Records
Journals
Trademark Registrations
Certified Financial Statements
