What to do with company records when you close
The short answer
When you close a company, keep what federal rules require: employment tax records 4 years, FLSA payroll records 3, hiring records 1, OSHA logs 5, and I-9s 3 years from hire or 1 after the job ends. Past those, delete, or license first if your contracts allow it.
Closing the company doesn't close the filing cabinet. The retention clocks keep running after the last paycheck, and someone has to hold the records until each one stops.
How long do I have to keep company records after closing a business?
Federal rules set the floor, and closing the business doesn't shorten them. Most run 1 to 5 years: hiring records 1, FLSA payroll records 3, employment tax records at least 4 and OSHA logs 5. Income tax records run 3 years or longer.
| Record | Keep for | Rule |
|---|---|---|
| Employment tax records | At least 4 years after the tax is due or paid, whichever is later | IRS record keeping guidance |
| Records behind an income tax return | 3 years after filing. 6 years if you left out more than 25% of gross income. 7 years for a bad debt or worthless securities claim | IRS record keeping guidance |
| Property records | Until the limitations period ends for the year you dispose of the property | IRS record keeping guidance |
| Payroll records, under the FLSA | At least 3 years from the last entry | 29 CFR 516.5 |
| Time cards and wage rate tables | At least 2 years | 29 CFR 516.6 |
| Personnel and hiring records, including applications | 1 year from the record or the action, whichever is later. Until final disposition if a discrimination charge is filed | 29 CFR 1602.14 |
| OSHA 300 log, annual summary and 301 reports | 5 years after the end of the year they cover | 29 CFR 1904.33 |
| Form I-9 | 3 years after the hire or 1 year after employment ends, whichever is later | 8 CFR 274a.2 |
The OSHA row applies only if the company had to keep OSHA logs. The hiring row runs one year from the termination date for anyone let go involuntarily, which in a shutdown is usually everyone.
4 years
The IRS minimum for employment tax records, which every closing employer holds
Who keeps company records once you close?
Someone has to, and the IRS asks you to name them. A final Form 941 needs a statement with the name of the person keeping the payroll records and the address where they will be kept.
That person is usually a founder, an officer or the company's accountant. Pick one before the shared drive goes read-only, and give them the export, the access and the list of what expires when.
Which company records can I delete when the business closes?
Once a record is past every retention period that covers it, and no audit, charge or lawsuit touches it, you can generally delete it. State rules can run longer than the federal ones, so check your state's tax and labor pages too.
The IRS adds one more check: before you discard records you no longer need for tax, find out whether an insurer or a creditor needs them kept longer.
Most of what a closing company holds was never on that list. Slack history, email threads, support tickets, the CRM and the code repository carry no federal keep period of their own, unless they hold one of the records above.
Can I license company records before I delete them at closing?
Often, yes, when the contracts and laws behind the records allow it. Retention rules say what you must hold. Who else may get a copy is a question for your customer contracts, your privacy notices and privacy law.
Deletion is the one step you can't take back, so put licensing in front of it. A chat archive or a ticket history you were about to wipe may be worth something to an AI lab, and a data license leaves you holding the original.
Start with the rights check, which asks about the contracts and consents that decide what you can license. Employee records need the most care. Our page on licensing HR and payroll records covers them.
What is the right order for company records at closing?
Export first, while every account is still paid for. Then set aside what the retention rules require, check the rights to the rest, and only then license or delete.
The closing checklist runs the records steps before the state filing for that reason. If you are tempted to skip all of it, our page on closing a business and walking away explains what that costs.
The final payroll returns and the payroll records statement are on the final tax return list.
Vaultfish helps you run the process. We are not lawyers and this is not legal advice. If you need counsel who knows this area, we can point you to one. Ask for a referral
