If you are running a business, use online banking and do not get paper statements each month, listen up!

You must save or print those statements and cancelled checks to a pdf file each month.

Most banks and credit unions make historical documents available for a limited amount of time that normally ranges from 12 to 18 months. After the time period has expired, obtaining those documents will be either 1) very costly or 2) impossible. So two years later, when the Internal Revenue Service, State Department of Revenue or the Labor Department demand to audit your records, you will be in a very bad situation if you failed to follow this advice.

Retaining these records is costly and a security risk for the Banks and Credit Unions. Retention guidelines of financial institutions are out of step with “real world” requirements.

The Bank Secrecy Act of 1970 spelled out record retention requirements that generally requires the financial institution to retain most records for a period of five years. However, it does not require the bank or credit union to maintain these records in any special manner that will make them easily accessible by you (the depositor) and BSA does not govern what they charge you for these records.

The second most vulnerable action for any business is one that is now becoming mandatory with taxing authorities, yet the BSA Rules for the Banks and Credit Unions are totally out of sync, Electronic Funds Transfers (EFT)!

The BSA does not require a bank to maintain records for the following types of funds transfers: (1) funds transfers where both the originator and beneficiary are the same person and that originator’s bank and the beneficiary’s bank are the same bank; and (2) transfers where the originator and beneficiary are any of the following:

1. A bank.
2. A wholly owned domestic subsidiary of a bank chartered in the United States.
3. A broker or dealer in securities.
4. A wholly owned domestic subsidiary of a broker or dealer in securities.
5. The United States.
6. A state or local government.
7. A federal, state, or local government agency or instrumentality.

Source: APPENDIX P: BSA RECORD RETENTION REQUIREMENTS