length of time for records

[Donny]

I need to do some housekeeping this summer, how long do I need to keep old records, and what is your best advise, shreed old records or return to client , if I can find them.(some of the address may be out dated). I looked at c. 230 but couldn't find an answer to this. thanks

[Margaret CPA in OH]

I, too, am cleaning up but not getting rid of client files altogether, only the paper. What I am doing, is scanning to disk and burning CD's. Each prior year CD, going back to 1996, will be on disk as well as each client. These archive disks will go to my bank safe box. The most recent 3 years will be on a CD for each year. Then every year, I will move the latest one to the bank vault. Of course I will also keep the recent 3 years on my duplicated hard drive with external backup in my fire proof safe. I hope this suffices for retaining client copies! I am so tired of paper.

[Donny]

I, too, am cleaning up but not getting rid of client files altogether, only the paper. What I am doing, is scanning to disk and burning CD's. Each prior year CD, going back to 1996, will be on disk as well as each client. These archive disks will go to my bank safe box. The most recent 3 years will be on a CD for each year. Then every year, I will move the latest one to the bank vault. Of course I will also keep the recent 3 years on my duplicated hard drive with external backup in my fire proof safe. I hope this suffices for retaining client copies! I am so tired of paper.

I burn to cds also I just need to know how many years for the paperwork I need to keep in my files, when I first started I was told to keep 7 years of paper, but I'm not sure this is still correct.

[jklcpa]

For CPAs I think requirement is 10 yrs if client is still a client, and it's 3 yrs for those no longer current clients.

Just be aware that you have to maintain the proper software/hardware to be able to access those CDs. A couple years ago I still had some stuff on 3.5" floppies that I burned to CD, even though my current computer still has a 3.5" drive.

[Margaret CPA in OH]

Thanks for the technology reminder. I still have my original computer with Window 3 or whatever sitting around just in case. Since I have client data on all computers, I decided to keep them all or at least the physical hard drives as long as necessary.

I looked quickly on the IRS website for some tax pro guidance but didn't find anything quickly. The 10 and 3 year times somehow sound familiar. I also am keeping everything in pdf format not just the ATX backup files. I would like to think that pdf will be around for awhile!

[bay]

I need to do some housekeeping this summer, how long do I need to keep old records, and what is your best advise, shreed old records or return to client , if I can find them.(some of the address may be out dated). I looked at c. 230 but couldn't find an answer to this. thanks

I do not believe that the IRS makes a distinction on whether or not you are a CPA or not. My policy is to keep client records (1040) for seven years - when I checked I recalled that the IRS said 6 years. If you are a CPA your should also check with your State Board. I checked with Ohio and they do not have any formal requirements. I have an engagement letter that each 1040 client signs that states among other items my record retention policy.

good luck

[Randall]

I do not believe that the IRS makes a distinction on whether or not you are a CPA or not. My policy is to keep client records (1040) for seven years - when I checked I recalled that the IRS said 6 years. If you are a CPA your should also check with your State Board. I checked with Ohio and they do not have any formal requirements. I have an engagement letter that each 1040 client signs that states among other items my record retention policy.

good luck

I think that 6 years is on the IRS fiscal year or closing year, which I think is 6/30. So if a return is on extension and filed after 6/30, the first year counting is the following 6/30. With all that confusion, I just think of 7 years.