Have you ever wondered how long you should keep your documents? Or wondered about throwing out documents you’ve been holding onto for over 5 or 10 years? You are certainly not alone.
In cases such as these, it’s important for your business to utilize a “document retention policy.” This is simply a guide that outlines which documents should be kept, for what duration of time and includes proper instructions on how they should be destroyed. A well-designed policy can save a business time and money while promoting efficiency and reliability. When beginning the process and constructing your very own policy, it’s important to include the following guidelines for these documentation categories:
- Legal documents – These documents typically include income tax returns, vital records such as birth certificates, payment checks, etc. and should NEVER be thrown out.
- Employee records – All employee records should be kept through the duration of the employee’s time working and kept up to five years after their departure.
- Accounting or corporate tax records – Any documents including federal tax returns, gross receipts, expense receipts, business transactions or any supporting documentation should be filed permanently.
- Electronic records – These are files typically stored on disks, hard drives, emails or web pages and can sometimes be the most difficult part of document retention. Employees must retain their electronic files as consistently as hard data and make sure a separate retention policy is enforced for digital documents.
- Federal/state law compliances – Documents that fall under this category (employee benefits, wage and hour provisions, taxes, occupational safety, etc.) include certain federal, state or local laws that put a specific period of time on how long documents should be retained.
Of course, there may be additional document categories depending on your business, so if you have any additional questions regarding your business’s document retention policy, feel free to contact our team at Microtek. We will help you plan your very own policy so that you can prevent the disposal of critical documents.