When most people start a business, they’re thinking more about creating than destroying. They start with a business plan. Then, they create a workplace. They construct products or services. Additionally, they establish relationships with clients, vendors, and employees. You should know how long you should keep your documents before shredding.
Over time, you’ll also start creating an overflow of office paperwork. At some point, these hard copies will fill up filing cabinets. Perhaps it will require storing older records off-site at additional expense.
At this point (or hopefully earlier), you will have to start thinking about destroying some of what has been created. That is if you want to cut down on clutter and expense. The only problem is that many business owners are unsure of how long they need to keep records. They don’t know when they can be sent out for document destruction.
How long should you keep documents before handing them over to your Florida document shredding service?
Here are a few things to consider.
The IRS only has guidelines regarding how long you should keep tax documents. However, it’s a place to start. According to the IRS, businesses only need to keep tax documents for three years from the date they were. They need to retain the filed forms for two years from the date taxes were paid.
Of course, this is assuming there are no criteria that could lead the IRS to further look back into your tax documents. Let’s say you have failed to report applicable income, for example. The IRS audit documents dating back six years. Plus, if you fail to file a return at all, you should keep documents indefinitely.
Generally speaking, however, you should play it safe. It’s best to hang onto tax documents for seven years. Then you can deliver them to your mobile document shredding company. This is what most accountants will recommend.
Beyond tax-related documents, there is little solid consensus on when it is wise to undergo document shredding. Anything related to finance should probably be kept for seven years. The same amount of time as tax documents. Conversely, there’s no real danger in getting rid of, say, job applications after three years.
Certain documents should be saved forever in their original hard copy format. This mainly concerns legal paperwork. Anything that shows ownership falls into this category. That is in addition to any documents pertaining to partnership agreements. You should retain documents that have to be signed and notarized. If there are attorneys involved in drafting and overseeing the process, plan to keep the original copy forever.