Here's How Long You Should Keep Your Business Tax Returns

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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
Why Should You Keep Your Tax Returns?
Documentation for Loans
In Case of an Audit
If You Want to Sell Your Business
How Long Is It Recommended That You Keep Business Tax Returns?
If you deduct the cost of worthless securities or bad debt, you need to keep your records for seven years.
If there’s any chance you didn’t report all income that should have been reported (and it’s more than 25% of the gross income stated on your return), you need to keep your return for six years.
If you don’t file a return (or file a fraudulent return), you need to keep your records forever – there’s no statute of limitations on fraudulent or unfiled returns, which means the IRS can come after you at any time.
Which Other Records Should You Keep?
Business Formation Documents
Employment Records
Employees' names, addresses, social security numbers, dates of employment, and occupation
Wages, annuities, and pensions paid to employees with dates of payment
Taxes withheld including FICA and Medicare
Records of tips and fringe benefits paid if applicable to your business, and
1099 documents for independent contractors
Sales Receipts
Business Asset Records
Others
Ledgers and registers Leases documents Loan documents Bank and credit card statements Insurance policies and records
Which Records Should You Keep Permanently?
Business formation documents Business licenses and permits Annual reports Shareholder meeting minutes Employer identification number Pension and retirement plan documents
Tips on Small Business Record Keeping
A business document scanner A cloud-based storage service A receipt app on your phone
The Takeaway
3 Small Business Loan Tips
Generally, it can be easier for entrepreneurs starting out to qualify for a loan from an online lender than from a traditional lender. Lantern by SoFi’s single application makes it easy to find and compare small business loan offers from multiple lenders Traditionally, lenders like to see a business that’s at least two years old when considering a small business loan. SBA loans are guaranteed by the U.S. Small Business Administration and typically offer favorable terms. They can also have more complicated applications and requirements than non-SBA business loans.
Frequently Asked Questions
About the Author
Susan Guillory is the president of Egg Marketing, a content marketing firm based in San Diego. She’s written several business books, and has been published on sites including Forbes, AllBusiness, and Cision. She enjoys writing about business and personal credit, financial strategies, loans, and credit cards. Follow her on Twitter @eggmarketing.
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