One of your highest priorities as a business owner should be protecting company records-- physical and digital. Customer information, company trade secrets, and competitive information can be accessed both physically and digitally. Fortunately, digital copies can be protected through multiple encryption methods.
Hard documents come with risks. Not only are they susceptible to fire, floods, and spilled coffee, but they can fall into the wrong hands. It’s not common to hear of a thief sneaking into an office to steal file folders. However, paper documents are easy to move around, maliciously or not. In 2011, Healthcare Info reported that a Massachusetts hospital got a hefty fine after an employee left sensitive patient files on a train. A 2016 Sports Illustrated story describes a backpack full of NFL player medical records that was stolen from a trainer’s car.
So when should you keep your hard copies? Let’s look at some of the common documents you have and how long you should keep them.
What Type of Documents Should You Keep?
A business owner you likely keep mountains of documents. Some you should keep, for a certain period of time. Let’s break down what to keep and for how long.
- Tax returns
- Major financial records
- Business license
- Insurance documents
Keep tax returns, business licenses, insurance documents, and other financial records permanently. This will help in the event of an audit or change in the hands of your business.
Store 3-7 Years
Supporting Tax Documents
W-2’s, 1099’s, bank and brokerage statements, charitable donations, receipts, etc. are all classified as support tax documents. The IRS will likely ask you for supporting documents and keeping these on file makes access to them easier.
Store One Year
- Regular financial statements
- Credit and debit statements
Holding on to these documents will help you come tax season. These documents will help you verify the accuracy of your tax forms when the time comes.
Store One Month
- Utility bills
- Withdrawal records
Utility, cable, cell phone bills, etc. should all be stored for at least one month until you are able to confirm that the payments have cleared. This prevents any mishaps or headaches in the event your bank, utility or mobile phone company makes a mistake on their end.
How to Properly Store a Hard Copy Document
It’s absolutely important that you store your hard copy documents correctly. While this might seem like a no-brainer, accidents can happen. Store all critical hard copy documents in a fire resistant filing cabinet. If you have so much information that you cannot keep it in-office, use a reputable offsite storage facility. Look for one with an up-to-date security system. Additionally, the unit will need to be temperature controlled to avoid any heat damage to documents.
What About Everything Else?
As a business, you likely have more than just receipts, licenses and tax documents to account for. You probably have sales and marketing brochures, invoice and quote templates, meeting notes, scanned signed documents and more. And, depending on your industry you may be required to adhere to strict compliance standards to retain records.
Many of these documents listed above may not even be in physical form but may be required by your industry’s guidelines to be stored for a certain amount of time. Rather than printing everything out and taking up additional space in your storage center, you can back these documents up digitally.
Not sure how to safely back up your important documents digitally? We’ve got you covered! Whether you’re a small business with no IT help or a big business with a large IT department, it never hurts to have an outsiders point of view. EmergeIT can help your team safely backup your important documents. Give us a call today to learn more about how we can help your business keep its sensitive information safe.
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