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Run the Payroll Fee Auditor →Blog · Payroll Management · E-Commerce
E-Commerce & DTC Brands: Payroll Recordkeeping Requirements (2026)
Payroll recordkeeping for e-commerce companies starts at the federal baseline, three years for payroll records and two for the time records behind them, then adds what reaches this industry: IRS Employment tax recordkeeping and USCIS Handbook for Employers M-274, section 10.0. BEG: $45 per employee per month inside the payroll software you already use, live in 3 to 5 days.
Records specific to e-commerce companies
The IRS requires employers to keep all employment tax records for at least four years after filing the fourth quarter return for the year, including amounts and dates of wage payments, employee names, addresses, Social Security numbers and occupations, and copies of Forms W-4.
A completed Form I-9 must be kept for every person on payroll for three years after the date of hire or one year after employment ends, whichever is later. This applies even to seasonal hires who leave shortly after the date of hire.
Employers must keep payroll records for at least three years and the records used to compute wages, such as time cards, work schedules and piece work tickets, for two years. Any timekeeping method is acceptable as long as it is complete and accurate.
The federal baseline every employer keeps
29 CFR 516 requires payroll records for three years and the records they were computed from, time cards, schedules and piece or commission records, for two years. Employment tax records stay four years after the return they support. Forms I-9 stay three years from hire or one year from separation, whichever is later. For e-commerce companies the practical rule is that the pay codes for seasonal workforce spikes and multi-state nexus payroll tax produce records of their own, and an audit reads those, not the summary.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- The IRS requires employers to keep all employment tax records for at least four years after filing the fourth quarter return for the year, including amounts and dates of wage payments, employee names, addresses, Social Security numbers and occupations, and copies of Forms W-4. [IRS Employment tax recordkeeping]
- A completed Form I-9 must be kept for every person on payroll for three years after the date of hire or one year after employment ends, whichever is later. This applies even to seasonal hires who leave shortly after the date of hire. [USCIS Handbook for Employers M-274, section 10.0]
- Employers must keep payroll records for at least three years and the records used to compute wages, such as time cards, work schedules and piece work tickets, for two years. Any timekeeping method is acceptable as long as it is complete and accurate. [DOL Fact Sheet #21]
Read the full guide to how to prepare for a payroll audit, and the rest of the e-commerce company payroll library.
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Frequently Asked Questions
E-commerce company records: IRS Employment tax recordkeeping
The IRS requires employers to keep all employment tax records for at least four years after filing the fourth quarter return for the year, including amounts and dates of wage payments, employee names, addresses, Social Security numbers and occupations, and copies of Forms W-4.
E-commerce company records: USCIS Handbook for Employers M-274, section 10.0
A completed Form I-9 must be kept for every person on payroll for three years after the date of hire or one year after employment ends, whichever is later. This applies even to seasonal hires who leave shortly after the date of hire.
How long does an e-commerce company keep payroll records?
Three years for payroll records and two for supporting time records under the FLSA, four years for employment tax records under the IRS rule, and longer where an industry rule cited above says so.
What does managed payroll cost for an e-commerce company?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Seasonal workforce spikes, multi-state nexus payroll tax and contractor vs W-2 for fulfillment are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including E-Commerce & DTC Brands. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: U.S. Department of Labor: Wage and Hour Division
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