What Records Do I Store and What Do I Keep on Hand?

Which types of records should I store in an offsite records storage facility, and what records should I keep on hand?

As a business owner, you need to set up a system that allows you to easily store records and information in a number of areas. There are laws that specify how long you need to keep employee and tax records. If you work in the medical profession, you also have strict laws about how to store those records.

The biggest question that we are asked is which types of files do you need to keep- and which files do you need to keep handy in case you need it.  One of the best ways to determine this is if you’re holding onto the document to maintain or monitor a business relationship, or if you’re holding on to it due to regulatory or legal requirements.  Any documents that have longer retention times can probably stored offsite in a secure facility.

It’s important to have a good system set up so that you can easily access the information as you need it, but also dispose of information that you no longer need in a timely manner. Once you set it up it should be relatively easy to maintain your records management system.  Freeing up space in your office to find records that you need vs. records that you might need can really increase efficiency and reduce the amount of records you have onsite.

Here’s a list of some of the more common types of records that businesses need to maintain, and our recommendations on whether you can store them offsite, or keep them in the office so you can access them easily.

Tax Records

According to the IRS, your tax records need to be kept for at least three years. However, if you are not reporting part of your income or carrying over a loss or a gain, you will need to keep them for three years after everything has been reported. It is best to talk to your accountant and clarify your specific situation.

Many experts say to keep your filed tax returns permanently. Your tax records related to your employees need to be kept for seven years after you have paid all taxes due on them. Most of these documents can be stored after the tax year is complete and you have filed your taxes. You only need to have on hand the current year’s documents. If you are audited, then you can retrieve the stored documents when you need them.

Employee Records

All employee records should be kept for at least seven years, especially in regard to taxes you paid on their behalf as part of their paycheck. You should also keep a file on each of your employees that documents their annual reviews and any discipline meetings you held with them. This can protect you in the event of a lawsuit or other issue.

When you do discard of these records, you need to be sure that all personal information is either marked out or the documents are shredded. You should keep an employee file in your office on each active employee. You can store the files for employees who have quit or retired in the last seven years.

Client Records

When it comes to client or customer records, you have a different set of rules that you need to follow. This system may be set up for you in a different way. You will want to store the customer’s files and information in a system that makes it easy to access when you need it.

For example, if you sell products and you know your customers order semi-annually, you will want to be able to reach out to them in the month leading up to the sale. You may want to set up a system that allows you to monitor this easily. If you have an account that goes inactive, then you need to decide how and where you will store the information.

Storing Information

You do not need to keep all of your records on hand at your office, even if you are required to continue to store the information for a certain number of years. It may be best to set up a system that allows you to flag files that are older and ready to store. Depending on the type of business that you run, you may want to store client records after three years of inactivity.

You will need to make the decision based on how often your customers come back for repeat business. You can store the prior years’ invoices and other account information at the end of each fiscal year. You should also permanently store any copies of contracts, mortgages and deeds.

Other Items You should Keep in the Office

You should keep any information on your current insurance policies for the business, any active loans, the current year’s bank statements and your current accounting system somewhere in the office. You should also keep the current years’ time cards for each employee on hand.

Additionally, if you know you need to access the information on a regular basis, it is a good idea to keep that information on hand instead of in a storage facility. You should still back up most of this information offsite, particularly if you collect it digitally.

Don’t dwell on the details- let our experts help with your Records Storage!

Information governance is an ever changing field as federal and state laws require more retention and faster discovery. Our experts will help you maintain your records storage needs regardless of format.  We can help you manage your hard-copy records, and even guide you through the transition to a paperless office.

Record Nations has been providing document management solutions for over a decade.  Let us help you find the right document storage solution for your business.  To get started, fill out the form on the top right of this page, or give us a call at (866) 385-3706. Within minutes, you’ll have several companies in your area to choose from.