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July 7, 2016

How Long Records Should Be Kept Before Calling for Houston Shredding

Companies acquire huge amounts of documents during their operational years. However, not all of them should be kept forever, which is why local shredding services in Houston, TX and elsewhere exist. Terry Masters of the Houston Chronicle notes:

The amount of time a company must keep these records on file depends on the type of record involved and the time limitations on the underlying activity that the document describes or substantiates.

Here are some specific types of documents, along with details on how long companies should hold on to them before they’d have to call for professional Houston shredding offered by firms, such as PROSHRED of Houston.

Tax records – Storage of all documents pertaining to taxes vary. In most cases, companies should hold on to their tax returns and other related documents (i.e. W-2s) for at least three years after the documents have been filed. On the other hand, certain situations may require companies to hold on permanently to the final copies of their income tax returns and related correspondences with the IRS. This is to prepare for amended returns in the future. All related time periods regarding the storage of relevant tax documents are tied to the IRS’ Statute of Limitations.

Employment records – Human resource files and all other documents related to current employees must be retained while the latter are working for the company, and at least seven years after a specific employee has left or have been terminated. Employment records typically consist of personnel files, payroll records, benefit enrolment forms, and medical records, all of which must be kept within the seven-year period.

Specific rules apply for documents concerning both job applicants and employees who suffered work-related accidents. A job applicant’s file must be kept for at least three years, while files of current employees injured on the job must be retained for at least four years.

Corporate records – Record-keeping requirements vary from state-to-state, but all companies are generally mandated to permanently keep copies of their finances, as well as overall organization and ownership documents. These include the so-called “constitutional” files like the by-laws and the articles of incorporation, shareholders’ agreements, minutes from all corporate meetings, and lists of correspondences concerning shareholders in recent years. Records of business assets are also considered as corporate records, and must be stored within the time limit as required by the IRS.

 

(Source: How Long Do You Have to Keep Company Records? Houston Chronicle)

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