Records Management Tips for Tax
Season and Beyond

Tax season may officially be over, but you can start setting a positive tone for next year by putting strong records management practices into place now. Try these records management tips to keep your documents and data in order.

Keep the Right Records

It can be confusing to figure out which tax records to keep and which ones to destroy. Documents with itemized deductions should be retained for a minimum of three years. Real estate records must be kept for as long as you own the property. Similarly, taxable stock and mutual fund purchases should be retained for as long as you hold those investments.

Make sure that any tax, business, or financial records are stored securely. Commercial records storage offers the most reliable and affordable solution for protecting documents and files from natural disasters and theft.

Go Digital

Converting your tax records to digital images makes it much easier to share them with your accountant, tax professional or—heaven forbid—an auditor. Be sure to remove staples and paper clips before running them through your scanner, and be cautious about feeding too many sheets of paper into the scanner at once, otherwise the machine may jam.

If you run a large organization with extensive tax records, it may be helpful to hire a document scanning provider to digitize them. These imaging professionals will scan your tax records to your preferred file format, use optical character recognition (OCR) software to make each file searchable and transfer your information to media or your enterprise content management (ECM) system.

Back Up Your Files

After digitizing your tax records, remember to also back them up. Some scanning providers offer free 60-day hard copy storage of tax documents and other business records after they are scanned. After that period expires, you can invest in an online document and image hosting solution. If you’re storing your tax records on a hard drive or back up tape, use a media vaulting service to ensure their long-term protection and preservation.

Shred to Prevent Tax Identity Theft

When you come across old tax records, it may be tempting to simply throw them away; however because they include sensitive personal and financial information, you should always shred them before disposal. Bank and ATM receipts, as well as pay stubs can be shredded after you reconcile them with your monthly and annual statements. For other documents, such as insurance or creditor information, check carefully before destroying since they may have different retention requirements than tax records.

To protect your employees and customers from identity theft during and after tax season, invest in a scheduled shredding service. Collection containers are placed in high traffic office areas to facilitate regular, secure disposal of paperwork. On a daily, weekly or monthly schedule, the contents of the containers are collected by a screened technician for NAID AAA-Certified onsite mobile shredding.

Put these records management tips into practice now, and they will carry you through next year’s tax season and beyond!

River Mill Data Management provides records management services to businesses in West, Central and South Georgia, as well as select counties in eastern Alabama. For more information, please contact us by phone or complete the form on this page.

Date Posted: April 27, 2017

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