Is your office getting cluttered up with old paperwork? Do you have employee files from the 90s that you would like to get rid of?
If you’re wondering how long to keep tax records and employee information, this article’s for you. We’ll give you the inside scoop on how long to keep documents and help you get started clearing out your office.
How Long to Hold Onto Bank Statements?
Whether you’re in the process of starting a new business or managing an existing one, you’ll need to keep your bank statements. But how many years should you hold on to them?
In general, you should hold onto annual bank statements for seven years. Online banking has progressed to the point that your bank can print out any information you need.
You can shred your monthly bank statements after one year, however.
How Long to Retain Employee Information?
If you’re wondering how long to keep documents pertaining to your employees, the answer is also seven years. If there’s been a workers’ compensation claim, you should hold onto that employee’s information for 10 years.
You might be surprised to learn that you should retain job applications for three years, even if you don’t hire that person.
The good news is that you can scan paperwork into your computer system so you don’t have to deal with office clutter.
If you’re dealing with serious clutter, however, don’t stress. Take a weekend day to sort, clean, and organize. You can get more cleaning tips from this site.
How Long to Keep Tax Records?
There are more than 25 million entrepreneurs in the United States, and they all have the same burning question. How long do you need to keep tax returns?
The IRS recommends that you keep your tax returns for at least three years, but preferably seven. They strive to do their audits in a timely fashion, but they will go back more than three years if they find a major error.
Talk to your accountant about the potential for digital storage of important files.
Is It Time for Spring Cleaning?
Ultimately, how long to keep tax records and other information is up to you. If you have the space to keep paper records, make sure that they’re properly secured.
Whether you have digital or paper records, you should know that human error is often the root cause of data breaches. Taking the time to make sure that your important information is locked up tight is key.
If you have paper records, make sure that they can only be accessed by appropriate personnel. The same advice holds true for online or cloud-based records.
If you feel like you have too much clutter and it’s overwhelming you, just do a little bit of spring cleaning at a time. Take your time to separate records into categories: current information and inactive information.
We have a wide range of templates that can help you organize your business, from hiring new employees to ongoing accounting procedures. Check out our blog and let us know what you think!