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Record Retention

Taxpayers who are subject to the federal income tax or who are required to file information returns with the Internal Revenue Service, must keep accurate records. In the event your return is audited, the auditor will expect you to substantiate the revenue and expenses reported on the return with proper accounting documentation. Generally, no penalty is imposed for failure to keep the required records. However, in case of a dispute with the IRS, the burden of proof is on the taxpayer. Incomplete or nonexistent records may result in interest, penalties and loss of legitimate deductions.

This guide provides suggested retention times for specific types of records. It is prepared based on information published by the American Institute of Certified Public Accountants. However, it is not all inclusive. For questions about specific applications, consult with your Accountant or Tax Preparer.

Permanent

  • Audit Records & Reports
  • Canceled Checks for Taxes, Property Purchases and Contracts
  • Cash Books
  • Charts of Accounts
  • Contracts & Leases (in effect)
  • Copyrights, Patents and Related Papers
  • Corporate Stock and Bond Records, Charters, Bylaws, Corporate Meeting Minute Books, Transfer Registers, Options, etc.
  • Current Insurance Records, Claims, Policies, etc.
  • Financial Statements (year-end. Others are optional)
  • Fixed Asset Records and Depreciation Records and Schedules
  • General Ledger and Journals
  • Income and other Tax Returns & Supporting Documentation
  • Real Estate Records (Deeds, Mortgages, Appraisals by Outside Appraisers, Bills of Sale, etc.)
  • Retirement and Pension Records
  • Tax and Legal Correspondence

Seven Years **

  • Accident Reports / Settled Insurance Claims
  • Canceled Checks (exception noted above)
  • Canceled Stock & Bond Certificates and Expired Option Records
  • Employee Earnings Summaries and Payroll / Personnel Records
  • Expense Reports, Analyses, Distribution Schedules and Payment Vouchers
  • Expired Contracts, Mortgages, Notes and Leases
  • Garnishments
  • Group Disability and other Insurance Safety Reports
  • Inventory Records of Products, Materials and Supplies
  • Invoices to Customers and from Suppliers
  • IRS Form 8300: Report on Cash Transactions Over $10,000 Received in a Trade or Business
  • Plant Cost Ledgers and other Cost Accounting Records and Reports
  • Purchase Orders, Shipping & Receiving records and related correspondence
  • Sales Records
  • Scrap and Salvage Ledgers
  • Subsidiary Ledgers and Schedules for Accounts and Notes Payable and Accounts and Notes Receivable
  • Voucher Registers and Schedules
  • Withholding Tax Statements

Three Years **

  • Bank Statements and Deposit Slips
  • Employment Applications
  • Expired Insurance Policies
  • Internal Audit Reports
  • Internal Reports (misc. financial)
  • Payroll Time Sheets or Cards

TESTIMONIALS

I would like to take this opportunity to commend Snyder and Company, PA for doing an outstanding job.  I can truly say that they provide excellent customer service.   I have had the pleasure of working with Rob for the last several years and I couldn’t ask for a more professional, dedicated and committed CPA.  Rob always give his undivided attention to whatever matter or concern may arise.  He has helped me over come several obstacles throughout the years and has done so graciously.  Rob has gone beyond the call of duty to assist me establish an LLC and healthcare benefits for the company.
 
Rob is very knowledgeable when it comes to the ever changing tax laws and provides guidance on the best way to move forward my when changes directly affect my business.   
 
I would not hesitate to recommend Snyder and Company to anyone in need of excellent financial service.
Sharon Carter, Owner-Director, Toddlers Tech

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