How long do I need to keep pay stubs? Perhaps this will be the most raised question among employees and employers during their initial days. Holding pay stubs is vital for both employers and employees. A pay stub contains a range of information relevant to tax and financial information.
This article elaborates on the importance of keeping pay stubs safe and organized in detail.
Why Employers Need To Keep Pay Stubs?
- To keep running your business/organization fully in compliance with the law.
- According to the Equal Employment Opportunity Commission (EEOC) it is mandated for companies to store employee pay records.
- Storing employees’ pay stubs will be handy when a company is facing a regulation investigation.
- Having well-organized payroll records will help businesses to complete certain business tasks effectively. Particularly in handling employees when they raise complaints about their payments.
- Stored and organized pay stubs will help companies to manage tax fillings.
Why Do Employees Need To Keep Their Pay Stubs?
- The foremost reason for employees to keep storing their pay stubs would be to show them as income proof.
- For employees pay stubs are vital documents where they can verify their pay details.
- Pay Stubs are very important for employed individuals to apply for loans or to rent a home.
- Pay stubs help employees to keep track of their tax deductions and other beneficiary deductions by employers.
How Long to Keep Holding Pay Stubs?
How long do you keep pay stubs? It doesn’t matter whether you are an employer or an employee. It depends on the purposes you are going to use them.
Let’s take a look at the time duration an employer and employee should store and make their own pay stubs.
1. How Long Do Employers Need To Keep Pay stubs?
If you are an American-based employer, you need to store all the financial records of your employees just like pay stubs documents. According to federal, state, and local labor regulations, companies or organizations should maintain clean records of their employee’s financial documents for at least three years.
Apart from that, it is safe to keep all those payroll statements safe and secure because the Fair Labor Standards Act (FLSA) points out that companies should keep their financial statements for at least three years. Managing all the payroll statements of employees in a physical format would be a tedious task, so companies’ opting for digital pay stubs is the best and easiest way to store them without clogging up the workspace.
2. How Long Do Employees Need To Keep Pay stubs?
As an employee receiving monthly payments, you should always have this question in mind. I keep my pay stubs safe or shred them?
Well, if you are an employee of an American-based company or organization you need to keep your pay stubs for at least one year. Employees should keep their old pay stubs until they receive the W-2 form for the current year. Because old pay stubs will be very useful to cross-check whether all pay details mentioned in W-2 forms are correct.
Once you paid all those taxes and received tax refunds on your income, you can dispose of all your stored pay stubs.
Best Way To Store Your Pay Stubs
Have you decided how long you need to keep pay stubs?
If Yes! Now it’s time for you to seek the best possible ways to store and organize your pay stubs.
Generally, storing and organizing a physical document for years will be difficult. Apart from eating up a lot of space, organizing and finding the relevant document when it’s needed is a frustrating thing for many people.
So, it’s better to have digital pay stubs or digitalize your physical pay stubs by scanning and uploading them to your computer. Once you manage to store all your pay stubs successfully as a digital record on your computer, you can easily handle it at any time you wish.
Creating Pay Stubs Instantly
Well, in today’s advanced digital technology, you can easily create pay stubs for your employees through an online pay stubs generator. There are numerous online pay stub generators allowing their users to create and share pay stubs instantly free of cost.
In addition, it gives the flexibility to employees on accessing them at anytime from anywhere. Moreover, for employers online pay stub creation is the best way to organize and store their pay stub records cost-effectively.
However, as a business owner, you need to make sure of engaging with a reliable and reputed online pay stub-generating platform that offers all safety measures to protect the privacy of your pay stubs. Even some platforms allow users to store them in their safe storages at a nominal price.
Keeping pay stubs safe and organized will always help you in managing your financial activities. If you are looking for an easy and simplest way of creating, managing, and storing pay stubs, preferring a reliable online pay stub generator would be the best.