Generally, your business needs to retain hard copies of certain documents. Actually, many Sarasota companies have switched to digital records. However, items like receipts, tax documents, deeds, lease agreements, contracts, employee records, etc. require hard copies.
Over time, these physical copies of data begin piling up. This is the case even in a relatively paperless office. Hence, you have to deal with several hassles. This includes managing, storing, and securing them. Understandably, you do not want them kept any longer than necessary.
Thus, there is a big question. How long should Florida businesses retain important documents before shredding? Here are a few guidelines to consider.
Typically, you’ll want to hang on to employee records. This includes time cards. Really, those should be retained for three years after termination. Though, employee earnings and tax records should be kept for four years.
This is for legal purposes. Truthfully, it is in case any disputes arise after a worker is terminated. In Florida, unclaimed property (including paychecks) should be retained for five years.
Of course, your Sarasota business should follow IRS guidelines. Therefore, retain financial documents and tax records per their requirements. To be safe, it is recommended that you keep tax records for at least seven years. Yet, this only applies if there is a question of fraudulent filing.
Perhaps, you do not report taxable income or you report inaccurate deductions. In either case, your company isn’t paying the IRS enough. Generally, the IRS has basic recommendations. They include saving records for three years from the date you file your taxes.
However, what if you make a mistake? Hence, it is best to keep documents for seven years. Maybe, you did not file a return. Perhaps, you filed a fraudulent return. Accordingly, your records should be retained indefinitely.
Any signed contracts should be retained permanently. Really, this includes documents related to partnerships, lease agreements, permits, and licenses, etc. Consequently, it is wise to have an original, signed document on hand. This serves as proof of an agreement, in case of a legal dispute.
In fact, it is best to keep documents if you are in doubt. Otherwise, consider consulting a CPA or attorney before shredding them. Let’s say you have decided to dispose of documents containing confidential data. Thus, be sure to give to your trusted mobile document shredding partner. In doing so, your destruction is assured.