SKR+Co Alert: Are you keeping the right tax records?
August 21, 2012
Records Retention: How long do we need to keep them?
Organizing, filing, and retaining old records is a burden for many businesses, not to mention individuals. As we move into a more "paperless" society, how do we determine what warrants taking up valuable office and storage space and what does not?
Records should be preserved only as long as they serve a useful purpose or until all legal requirements are met. To keep files manageable, it is a good idea to develop a schedule so that at the end of a specified retention period, certain records are destroyed.
At Stockman Kast Ryan + Co., we have developed a Records Retention Schedule we think you will find helpful. Although it doesn't cover every possible record, it does cover the most common ones. As always, please feel free to ask us should you have specific questions or concerns.
SKR Tax Record Retention Schedule (Click Here)
Is your receipt for your charitable gift satisfactory to the IRS?
So you thought you had proper substantiation for your charitable gift? Think again. A recent court case made it very clear that the IRS will not bend on certain requirements.
For any contribution of $250 or more, § 170(f)(8) provides that no deduction is allowed unless the taxpayer substantiates the contribution by a contemporaneous written acknowledgment of the contribution by the donee organization. The contemporaneous written acknowledgment must contain the following information:
the amount of cash and a description of any property other than cash contributed;
a statement whether the donee organization provided any goods or services in consideration for the contribution; and
a description and good faith estimate of the value of any goods or services provided in consideration for the contribution, or, if the goods or services consist solely of intangible religious benefits, a statement to that effect.
Based on this information, we suggest that you check to make sure that the statements you receive from your charities contain the proper verbiage above. If you serve on a board for a charity, make sure the statements you provide meet the IRS' criteria.
For information about the recent Tax Court case, read the Memo Issued by the Tax Court.
Did you know?
We are a proud member of DFK International/USA, a worldwide association of independent CPA firms with locations in over 30 major markets throughout the United States and representation in 70 countries. Learn more HERE.
Meet 2 of our Tax Professionals:
Judy Kaltenbacher, CPA
Eric Ryan, CPA, PFS
If you have questions about the issues raised in this article or would like to contact us, call us at (719) 630-1186 or email us through our Secure Email.