Recordkeeping

How Long to Keep Records

How Long Do I Keep Records

Our standard answers…

  • 3 years is the Statute of Limitations for audit purposes (from the due date of the return or the filing, whichever is later).
  • 4 years for Employee Records
  • 6 years if there is a 25% understatement of income (accidental, misinterpretation of tax law, bookkeeping error, involved in one of those too good to be true tax shelters).
  • 7 years for Loss from Worthless Securities or Bad Debt deductions
  • Fraud is forever.
  • If you still have the asset, you need the records.  (i.e.  You sell a building you’ve owned for the last 20 years.  The sale is within the Statute of Limitations.  Anything related to that sale must be provable – original cost, improvements).

The best information is available here by clicking on this IRS information page…

IRS – How Long Do I Keep Records (Rules are different depending….)