The file

How long to keep the records.

The minima observed in this practice. Keep longer if the year was irregular, income was omitted, or you simply prefer the paper near. General information — not advice for your facts.

“Seven years” is the default in this office unless a shorter legal minimum is clearly enough — or the document is the kind you never throw away (returns, formation papers, basis). When in doubt, keep it. Storage is cheaper than a missing closing statement.

Returns and the papers behind them

The IRS generally has three years to audit a timely filed return, six if a large amount of income was left off, and no limit if a return was never filed. We plan for the long end.

  • Filed federal and state tax returns

    Permanently

    The return is the map. Copies are cheap; reconstructing a year is not.

  • W-2s, 1099s, 1098s, K-1s, and brokerage 1099-Bs

    7 years

    From the date you filed the return they support.

  • Receipts, mileage logs, charitable acknowledgments

    7 years

    If it changed the tax, keep it with that year’s file.

  • Estimated-tax payment records

    7 years

    Vouchers and canceled payments for the year they apply to.

  • IRS or Florida DOR notices and your replies

    Permanently, or 7 years after closed

    A closed notice can come back as a related year. Keep the correspondence.

Bank, cards, and investments

Statements prove deposits and basis. Screenshots of a balance are not a file.

  • Bank and credit-card statements

    7 years

    Longer if they are the only proof of a deduction or of basis.

  • Canceled checks for taxes, property, or large assets

    7 years, or with the asset file

    Keep with the house or equipment file if they establish basis.

  • Brokerage statements and Form 8949 support

    7 years after you sell

    You need cost basis. Year-end summaries are not enough if lots are missing.

  • Retirement account statements (IRA, 401(k))

    Until 7 years after the account is emptied

    Especially Form 8606 and after-tax / Roth basis.

Home, vehicles, and other assets

Basis lives longer than the year you bought the thing. Sell later, prove it then.

  • Closing statements, improvements, and cost of the home

    7 years after you sell

    Improvements raise basis. A kitchen from 2014 still matters in 2028.

  • Vehicle purchase, sale, and business-use logs

    7 years after you sell or stop using it in the business

    Required if you take actual expenses or depreciation.

  • Depreciation schedules and asset lists

    Life of the asset + 7 years

    We keep these in the firm file. You should too.

Business books

If you keep a company file, the books are the return. Keep the system, not a loose archive of PDFs.

  • QuickBooks (or other) company file and backups

    Permanently, with annual backups

    A live file plus a year-end copy. Cloud is not a backup if you lose access.

  • Year-end financial statements

    Permanently

    P&L, balance sheet, and the adjusting entries for that year.

  • Invoices, bills, and merchant statements

    7 years

    Match them to the year of income or expense.

  • Contracts, leases, and operating agreements

    7 years after they end

    Keep formation documents permanently.

  • Sales-tax filings and exemption certificates (Florida)

    At least 3 years; 5 is safer

    Florida DOR generally looks back three years. Keep certificates as long as they are used, plus three.

Payroll and people

Employment tax records have their own clock. It is longer than you think if a worker is reclassified.

  • Payroll registers, W-2s, W-3s, 941s, 940s, W-4s

    At least 4 years after the tax is due or paid

    We keep seven in this practice. Same for Florida reemployment filings.

  • 1099-NEC files and W-9s

    7 years

    Proof you treated a payee as a contractor — or that you should not have.

  • I-9s

    3 years after hire, or 1 year after separation — whichever is later

    Separate from the payroll binder. Do not store them in the general personnel file if you can avoid it.

Keep it longer if any of this is true

  • You did not file, or you filed late and the statute is still open.
  • You left off a large amount of income (the six-year rule).
  • You claimed a loss from a worthless security or a bad debt.
  • A year is under exam, or a related year still is.
  • You have carryforwards — NOLs, credits, capital losses.

What you can shred

Drafts once the final return is filed and stored. Duplicate bank logins printed “just in case.” Utility bills that never hit a return or a basis file. Pay stubs after the W-2 has been checked and the return is in the permanent file. Shred, do not trash.

We keep a copy of what we prepared. That is not a reason to throw yours away. If you leave the firm, you should still be able to reconstruct the year without us.

General information only. Not written tax advice for your facts. See the Circular 230 notice. Questions: Info@woodandsons.net.