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Guide To Record Retention For Auto Dealers

You can rely on a reasonable record retention policy such as this one if you have thrown away records which are later requested of you.  However, in order to use the policy as a defense, you should exercise the policy and discard documents on a regular (at least yearly) basis.  Remember to shred any consumer or personal indentifying information.
DMV SUMMARY
 
The Texas DMV requires a dealer to keep a complete, accurate record of all vehicle purchases and sales (retail or wholesale) for a minimum period of 48 months.  The current and previous 13 months of records must be kept at the dealer's licensed location and be available for inspection by a TxDMV representative.  The remaining 35 months of records need not be kept at the dealer's licensed location.  Records may be kept in an electronic format and capable of being printed out during normal business hours.  If the original title is kept by the floor planner, the dealer is required to keep a copy of the front and back on the dealership premises in its files.

OCCC SUMMARY

Rules can be found in the Texas Administrative Code, Title 7, Part 5, Chapter 84, Subchapter G, Sec 84.707-709. 
 
Retention and availability of records: All books and records required by this subsection must be available for inspection at any time by Office of Consumer Credit Commissioner staff, and must be retained for a period of three years from the date of the last payment made on the retail installment sales transaction, four years from the date of the contract, two years from the date of the final entry made thereon, whichever is later, or a different period of time if required by federal law. Upon notification of an examination pursuant to Texas Finance Code, §348.514(f), the licensee must be able to produce or access required books and records within a reasonable time at the licensed location or registered office specified on the license.
  
ACCOUNTING
Audit Records - Permanently
Accounts Receivable or Payable Ledger - 8 years
Bank Statements and Reconciliations- 5 years
Canceled Checks--Payroll and General- 5 years
Canceled Checks--for purchase of assets should be filed with records - 5 years after disposition of asset
Capital Stock Book- Permanently
Cash Disbursement Journal- 8 years
Cash Received Journal- 8 years
Expense Reports - 6 years
Expense Ledger- 8 years
Financial Statements (retain permanently of no audit reports) - 8 years
General Ledger and Journal- Permanently
Interdepartmental Sales Journal- 8 years
Inventory Records-Annual Only - 8 years
New Car Sales Journal - 8 years
Notes Receivable Ledger- 8 years
Parts, Accessories, and Service Sales Journals - 8 years
Payroll Earnings Records- 5 years
Payroll Journal- 5 years
Payroll Time Cards- 3 years
Petty Cash Vouchers- 3 years
Petty Cash Summary Envelope- 3 years
Prepaid and Accrued Expenses Journal- 3 years
Subsidiary Ledger- 8 years
Trial Balances- 8 years
Vouchers-Vendors, Employees - 8 years
  
CORPORATE
Articles, By-Laws, Minutes, other corporate records- Permanently
  
CORRESPONDENCE
General - 10 years
Legal and Tax- Permanently
 
OPERATIONS
Accident Reports- 6 years
Bills of Lading- 10 years
Buyer's Guide-Used Car Label* - No requirement*
Car Invoices* - 6 years
Car Purchase Orders*- 10 years
Credit Applications-denied* - 2 years
Credit Applications-approved*  - No requirement / secure destruction / shred
Customer Files* - 10 years
Employment Applications, terminated and not hired - 3 years / secure destruction
Employment Applications, hired- 3 years past termination
Insurance Policies, expired- 4 years
Internal Repair Orders* - 3 years
Odometer Statements* - 5 years
OSHA Records - 6 years
Personnel Files, Closed - 6 years after termination
Purchase Orders - 6 years
Repair Estimates - 9 months
Repair Order - 2 years
Retail Installment Contract, assigned* - 10 years
Retail Installment Contract, not assigned* - 10 years past expiration
Sales Invoices - 6 years
Service contracts/Extended Warranties* - 10 years past expiration
Shipping and Receiving Reports - 6 years
Underground Storage Tanks--testing results and DNR correspondence - Permanently
Uniform Hazardous Waste Manifests - 3 years
 
TAXES
Form 8300-$10,000 Cash Reporting Form - 5 years
Income Tax Returns, U.S. and State - Permanently
Income Tax Returns, related work papers - 5 years
IRS Audit Results- Permanently
Unemployment Tax Returns, U.S. and State  and related work papers - 5 years
Withholding Tax Returns, U.S. and State and related work papers - 5 years
Withholding Tax Statements - 5 years

SOURCE

CliftonLarsonAllen LLP
600 Washington Avenue, Suite 1800
St. Louis, MO 63101-1312
314-925-4300 | fax 314-925-4350
  
*These items would ordinarily be in the car deal jacket.  Each item has its own retention requirement.  However, unless you want to strip the file, keep the car deal for 10 years.  Even then, contracts which are performed over time, for example, retail installment contracts (if you are carrying the financing, not those that are assigned) and service contracts, should be kept for 10 years past their expiration.
 
The Used Car Buyers' Guide is not technically required to be kept.  However, if you don't keep a signed copy, it will be difficult to prove that your customer received one.

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