How long should I keep my business receipts and financial records?

The IRS generally recommends keeping records that support income and deductions for at least three years from when you filed, which matches the standard audit window. Keep them six years if you might have underreported income by more than 25%, and seven years for records tied to bad-debt or worthless-securities claims. Employment tax records should be kept at least four years. Records tied to property, like equipment you depreciate or a home office, should be kept until several years after you dispose of the asset, since they establish your cost basis. Digital copies are acceptable, so scanning receipts and storing them in labeled folders satisfies the requirement and beats a shoebox. When in doubt, keep tax returns themselves indefinitely.