DHL&S Dworken, Hillman, LaMorte & Sterczala, P.C.
Company Profile
Principals
Eric N Hendlin, CPA
James G. Cosgrove, CPA
Walter R. Fulton, CPA
Michael F. Ganino, CPA
William C. Lesko, CPA
Alberto C. Martins, CPA
Paul M. Sterczla, CPA
Joseph A Verrilli, CPA
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  Four Corporate Drive
  Suite 488
  Shelton, CT 06484

  Tel (203) 929-3535
  Fax (203) 929-5470

Record Retention

We are available to consult with you to make sure you and your business avoid penalty exposure by being in full compliance with the new IRS computerized recordkeeping rules.

Federal tax laws require taxpayers to maintain the books and records needed to support amounts reported on federal tax returns. These days, many taxpayers keep some or all of their financial and tax records in an electronic (computerized) format. The IRS recently issued new guidelines for such computerized records. The federal government can potentially seek civil and criminal penalties if these guidelines are not followed. The specific rules relating to the period records must be kept are quite detailed; however, as general guidelines, we recommend the record retention periods listed below. In some cases, the recommendation may be for nontax reasons, for example for environmental liability-exposure reasons, keep real estate records forever.

Remember, the items listed below are general guidelines
TYPE OF RECORD RETENTION PERIOD
Copies of tax returns as filed Forever
Tax and legal correspondence Forever
Audit reports of tax authorities Forever
General ledger Forever
Financial statements Forever
Contracts and leases Forever
Real estate records Forever
Corporate stock records and minutes Forever
Bank statements and deposit slips 6 Years*
Sales records and journals 6 Years*
Other records relating to revenue 6 Years*
Employee expense reports and records relating to travel and entertainment expenses 6 Years*
Cancelled checks 3 Years*
Paid vendor invoices 3 Years*
Employee payroll expense records 3 Years*
Inventory records 3 Years**
Depreciation schedules At least tax life of asset plus 3 years
Other capital asset records At least tax life of asset plus 3 years
Other records relating to expenses 3 Years*
* From the later of the tax return due date or filing date
** Longer if you use LIFO