Keep or delete? Nonprofits, here’s what you need to know about record retention.

Record retention policies (also called a ‘schedule’) describes how long an organization needs to keep a piece of information (record), where it’s stored, and how to dispose of it when the time comes.

Having a record retention policy is critical to maintaining compliance and reducing risks. It also helps organizations save storage and operating expenses when dealing with large amounts of printed or digital files.

Practical Consideration: Document retention policies apply equally to documents saved in the cloud, on a server, or in a filing cabinet. If your nonprofit is using digital storage, make sure you have a back-up.

Document retention policies are one of several good governance policies that the IRS highlights on the IRS Form 990 by asking whether the filing nonprofit has adopted a written record retention policy.

What should be retained?

Guidelines for record retention vary greatly, based on the types of documents the nonprofit generates as well as state and local laws. Some documents need to be permanently retained, while others have a shorter retention period.

The following is a summary of common recommendations for nonprofit record retention that can generally serve as a good starting point for checking state-specific regulations.

Corporate Records

DocumentRetention Period
Annual reports to the secretary of state or attorney generalPermanent
Articles of incorporationPermanent
Board meeting and board committee minutesPermanent
Board policies and resolutionsPermanent
Construction documentsPermanent
Fixed asset recordsPermanent
IRS application for tax-exempt status (Form 1023)Permanent
IRS determination letterPermanent
State sales tax exemption letterPermanent
Contracts7 years after termination
General correspondence3 years


Accounting and Corporate Tax Records

DocumentRetention Period
Annual audits and year-end financial statementsPermanent
Depreciation schedulesPermanent
IRS Form 990 tax returnsPermanent
General ledgers7 years
Business expense records7 years
IRS Form 10997 years
Journal entries7 years
Invoices7 years
Sales records (books)5 years
Petty cash vouchers3 years
Cash receipts3 years
Credit card receipts3 years


Bank Records

DocumentRetention Period
Check registers7 years
Bank deposit slips7 years
Bank statement and reconciliation7 years
Electronic fund transfer documents7 years


Payroll and Employment Tax Records

DocumentRetention Period
State unemployment tax recordsPermanent
Payroll recordsPermanent
Garnishment records7 years
Payroll tax returns7 years
W-2 statements7 years
Employment tax recordsAt least 4 years after filing the year’s 4th quarter taxes (or longer, if required by state law)


Human Resource Records

DocumentRetention Period
Employment and termination agreementsPermanent
Retirement and pension plan documentsPermanent
Records relating to promotion, demotion or discharge7 years after termination
Accident reports and workers’ compensation records5 years
Background checks, drug test results, driving records and employment verifications5 years
Resumes, employment applications and related materials (including interview notes) for employees4 years after termination
Resumes, employment applications and related materials (including interview notes) for applicants not hired3 years
Timesheets, compensation history and job history4 years after termination
Performance appraisal and disciplinary action records4 years after termination
I-9 forms3 years after hire date or 1 year after employment ends (whichever is later)


Donor and Grant Records

DocumentRetention Period
Donor records and acknowledgment letters7 years
Grant applications and contracts7 years after expiration


Legal, Insurance and Safety Records

DocumentRetention Period
Copyright registrationsPermanent
Environmental studiesPermanent
Insurance policiesPermanent
Real estate documentsPermanent
Stock and bond recordsPermanent
Trademark registrationsPermanent
Leases7 years after expiration
OSHA documents5 years
General contracts3 years after expiration


Contact D+L for Guidance on Record Retention Policies

For nearly 50 years, Dugan + Lopatka has partnered with nonprofit organizations to navigate every step of the financial journey. At D+L, our CPAs and consultants are always on the cutting edge of changes in the nonprofit sector. We understand the challenges you face—the special accounting, auditing, and reporting requirements of your organization—and we use our deep expertise to deliver exceptional service tailored to your needs.

Contact us today.

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