The general rule
In practice most small businesses keep everything for seven years, because the cost of storing a PDF is nothing and reconstructing a year of invoices is not.
Records that outlive the general period
- Anything supporting the cost of an asset you still own — keep it while you own the asset, and afterwards for the period covering the year you disposed of it
- Employment tax records, which have their own retention period
- Contracts and engagement letters, for as long as a claim could arise under them
- Anything relating to a year under examination, until the examination closes
What form to keep them in
Electronic copies are acceptable to the IRS provided they are complete, legible and retrievable. What matters is that a record can be produced on request — a PDF you cannot find is the same as no record at all.
What actually gets lost
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Invoices that lived only in an email account
Accounts get closed, providers change, and search stops finding things. Export the PDFs somewhere you control.
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Records inside a tool you stopped paying for
Access ends with the subscription. Export before you cancel, not after.
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The one folder on one laptop
A single copy is not a record. Two copies in different places is the minimum that survives ordinary bad luck.
Common questions
- Do I need paper copies?
- No. Electronic records are acceptable provided they are complete, legible and can be produced when asked for.
- Does this apply to quotes and proformas?
- They are not accounting records in the same way, but they are evidence of what was agreed. Keep them with the job — they cost nothing to store and settle most disputes about scope.
- What about state requirements?
- States set their own periods for their own taxes, and some are longer than the federal one. If you are registered for sales tax, check your state's own retention rule as well.
Figures on this page last reviewed 2026-08.