Category Archives: Electronic Media Storage Guidelines

Electronic Recordkeeping, Hard Copies and the IRS

Caution Sign When Saving Tax Records and Using Electronic Media StorageElectronic Recordkeeping, Hard Copies and the IRS

Even if your system crashes, you still must be able to RECONSTRUCT your records to their specifications. Do you know what they are?  

Read about what you can and can’t do if you plan on storing your tax records electronically.  In many cases you need to keep hard copies – in print.  The IRS must be able to access your electronic media at any time it wants.  You need to know what you can and cannot do.  One thing you CAN’T DO is use the excuse “my computer hard drive crashed.” 

Read our post on the use of electronic media for saving tax & business records.


Green Checkmark

Record Retention for Small Business & Self-Employed Taxpayer – Learn why you should keep records, what kinds of records to keep and how long you should keep your records.

Why should I keep records?
Good records will help you monitor the progress of your business, prepare your financial statements, identify source of receipts, keep track of deductible expenses, prepare your tax returns, and support items reported on tax returns.

What kinds of records should I keep?
You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.

How long should I keep records?
The length of time you should keep a document depends on the action, expense, or event the document records. You must keep your records as long as they may be needed to prove the income or deductions on a tax return.

How long should I keep employment tax records?
You must keep all of your records as long as they may be needed; however, keep all records of employment taxes for at least four years.

How should I record my business transactions?
Purchases, sales, payroll, and other transactions you have in your business generate supporting documents. These documents contain information you need to record in your books.

What is the burden of proof?
The responsibility to prove entries, deductions, and statements made on your tax returns is known as the burden of proof. You must be able to prove (substantiate) certain elements of expenses to deduct them.


Page Last Reviewed or Updated: 29-Apr-2014

How long should I keep records, and other business files

How Long Do You Really Need to Keep Your Financial Documents?

Files and a messy deskNow that April 15 has come and gone, everyone is writing about tax information, records to keep, and records you can discard.  For some it’s just personal tax records.  For others, it’s personal and business documents.  However, before you go out and purchase electronic media to store records and receipts, please read our March 26 blog, Keeping Business Records Continue reading

Use of Electronic Media for Saving Tax & Business Records

Electronic recordkeeping mediaConsidering the use of Electronic Media for Saving Tax & Business Records?

Whether you are starting a new business – or have an established business – you might be looking at how to improve your record keeping practices.

If you have considered the use of electronic media for saving tax & business records you will also want to be sure you are in compliance with the IRS rules and regulations for electronic storage systems. Continue reading