Good records do two jobs: they support every number on your tax return, and they protect you if the IRS ever asks questions. But how long do you actually need to keep them?

Most records only need to be kept for three years after you file. But payroll, property and a few special situations call for longer periods, and some records should never be thrown away.

When in doubt, keep your tax returns and year-end financial statements permanently.

Here’s how long the IRS says to keep each type of record (IRS).

Most income and expense records, counted from the date you filed the return.

Employment tax records, counted from the date the tax is due or paid, whichever is later.

If you didn’t report income worth more than 25% of the gross income shown on your return.

If you claimed a loss from worthless securities or a bad debt deduction.

Keep these records until the period of limitations expires for the year you sell or dispose of the asset. They support your depreciation and any gain or loss.

If you didn’t file a return, or filed a fraudulent one.

Scanned and electronic records are acceptable to the IRS, as long as they’re complete, legible and you can retrieve them when needed. A simple folder structure by year and category, backed up in the cloud, saves hours at tax time.

The IRS also reminds business owners that records may be needed for other reasons. Insurance companies, lenders and buyers may ask for them long after the tax period closes. When you do discard paper records, shred them, since they contain sensitive data.

Not sure what you have or where it is? We can help you organize your records and keep them that way.

This article is for general information only and isn’t tax advice for your specific situation.