As a general rule, it is a good idea to keep copies of receipts, bills, and invoices for your business for at least three years. This is the standard retention period recommended by the Internal Revenue Service (IRS) for most business records.
However, the specific retention period for your business records may vary depending on your specific business and the type of records you are keeping. You may need to keep some records, such as real estate transactions or employee payroll for a longer period of time. You may also want to keep many documents longer for business continuity, loan applications, or in case of a tax audit.
It’s a good idea to consult with a bookkeeper, accountant or tax professional, or refer to IRS guidelines to determine the specific retention periods for different types of business records.
In addition to keeping records for tax purposes, it’s also important to keep copies of receipts, bills, and invoices for your business in order to track expenses, manage cash flow, and make informed financial decisions. By keeping accurate and up-to-date records, you can more effectively manage your business and make informed financial decisions.
Overall, it’s a good idea to establish a record-keeping system for your business that allows you to easily access and retrieve receipts, bills, and invoices as needed. This may include maintaining physical copies of these documents. But ideally, you also want to store and organize them electronically in a secure location. By keeping accurate and organized records, you can more easily track expenses, manage cash flow, and meet your tax reporting obligations.