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Specializing in Bookkeeping and Taxes for Small to Medium Size Businesses

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Record Retention

Document Retention Grapevine - Guidelines on Keeping Documents Keller - Document Storage Colleyville

Taxpayers who are subject to the federal income tax or who are required to file information returns with the Internal Revenue Service, must keep accurate records. In the even your return is audited, the auditor will expect you substantiate the revenue and expenses reported on the return with proper accounting documentation. Generally, no penalty is imposed for failure to keep the required records. However, in case of a dispute with the IRS, the burden of proof is on the taxpayer. Incomplete or nonexistent records may result in interest, penalties and loss of legitimate deductions.

This guide provides suggested retention times for specific types of records. It is prepared based on information published by the American Institute of Certified Public Accountants. However, it is not all inclusive. For questions about specific applications, consult with your Accountant or Tax Preparer.


Audit Records & Reports

Canceled Checks for Taxes, Property Purchases and Contracts

Cash Books

Charts of Accounts

Contracts & Leases (in effect)

Copyrights, Patents and Related Papers

Corporate Stock and Bond Records, Charters, Bylaws, Corporate Meeting Minute Books, Transfer Registers, Options, etc.

Current Insurance Records, Claims, Policies, etc.

Financial Statements (year-end. Others are optional)

Fixed Asset Records and Depreciation Records and Schedules

General Ledger and Journals

Income and other Tax Returns & Supporting Documentation

Real Estate Records (Deeds, Mortgages, Appraisals by Outside Appraisers, Bills of Sale, etc.)

Retirement and Pension Records

Tax and Legal Correspondence


Bank Statements and Deposit Slips

Employment Applications

Expired Insurance Policies

Internal Audit Reports

Internal Reports (misc. financial)

Payroll Time Sheets or Cards

Petty Cash and Cash Paid-Out Vouchers

Physical Inventory Tags and Control Records

Records in support of Customer Guarantees and Warranties

Sales Commission Reports


Accident Reports / Settled Insurance Claims

Canceled Checks (exception noted above)

Canceled Stock & Bond Certificates and Expired Option Records

Employee Earnings Summaries and Payroll / Personnel Records

Expense Reports, Analyses, Distribution Schedules and Payment Vouchers

Expired Contracts, Mortgages, Notes and Leases


Group Disability and other Insurance Safety Reports

Inventory Records of Products, Materials and Supplies

Invoices to Customers and from Suppliers

IRS Form 8300: Report on Cash Transactions Over $10,000 Received in a Trade or Business

Plant Cost Ledgers and other Cost Accounting Records and Reports

Purchase Orders, Shipping & Receiving records and related correspondence

Sales Records

Scrap and Salvage Ledgers

Subsidiary Ledgers and Schedules for Accounts and Notes Payable and Accounts and Notes Receivable

Voucher Registers and Schedules

Withholding Tax Statements


Bank Reconciliation’s

Duplicate Deposit Slips

General business correspondence

Retention time is measured from the later of tax return due date or filing date, plus any amendment or extension date

Other Misc. Records

1. Real and Personal Property – Three years beyond the time the property is in use.

2. Passive Losses – If a taxpayer is unable to currently deduct a loss from a passive activity, they are permitted to carry forward the loss indefinitely until the loss is used to offset passive income or the passive activity is disposed of in a taxable transaction. Carry forward losses are computed on worksheets provided by the IRS and these worksheets should be retained until at least three years after the carry forward losses are used.

3. Nondeductible IRA Contributions – Taxpayers who make non-deductible IRA contributions are required by the IRS to retain all the tax records that pertain to such contributions until the taxpayer’s IRA’s are fully distributed. these records include form 8606, Forms 1040 or 1040A, Form 5498 and forms 1099-R or W-2P.

4. Principal Residence – Records verifying a taxpayer’s basis in his or her principal residence must be kept until he or she is sure they will no longer be an issue. Such records pertain to original cost, capital improvements and Form 2119 – Sale or Exchange of Principal Residence.

Areas We Service in DFW


North Richland Hills

North Fort Worth

Trophy Club


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This guide provides suggested retention times for specific types of records.


1670 Keller Parkway, Suite 250, Keller TX 76248

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