How long should payroll records be kept?

Payroll Record Retention Requirements in New Jersey

As of 2026, businesses operating in New Jersey should retain payroll records for a minimum of four years. This retention period aligns with both state and federal payroll tax requirements.

What Payroll Records to Keep

• Employee information: Names, addresses, Social Security numbers, and dates of birth.
• Time and attendance records: Hours worked, overtime, and leave taken.
• Wage and salary details: Pay rates, bonuses, commissions, and deductions.
• Tax documents: Copies of W-2s, W-4s, and state withholding forms.
• Benefits and insurance records: Contributions and deductions related to employee benefits.

Operational Best Practices

• Use digital recordkeeping systems with secure backups to ensure data integrity and accessibility.
• Automate payroll processes to reduce errors and maintain compliance with New Jersey payroll tax reporting.
• Coordinate payroll record retention with bookkeeping and tax reporting schedules to streamline audits and reviews.
• Ensure separation of employee classification records to support compliance with unemployment and workers’ compensation insurance requirements.

Why Retain Payroll Records for Four Years?

New Jersey's Division of Taxation and the IRS may audit payroll tax filings within this timeframe. Maintaining organized and complete payroll records supports accurate tax reporting, compliance with wage and hour laws, and efficient resolution of any discrepancies.