How long do I have to keep my foreign-owned LLC's records — is there a fixed number of years?

There is no single 'keep seven years and shred' rule here. Treas. Reg. 1.6038A-3(g) says required records must be kept as long as they may be relevant or material to determining the correct tax treatment of any transaction between you and a related party — but in no event less than the applicable statute of limitations on assessment and collection for the taxable year in which the transaction or item affects your US tax liability. So the floor is the limitations period, and the test is relevance.

Your example is exactly the trap the regulation's last clause is built for. If you buy inventory from your foreign affiliate in Year 1 but it doesn't flow through cost of goods sold until Year 3, the purchase records affect Year 3's US tax liability — so you keep that file through Year 3's limitations period, not Year 1's. The same logic governs deferred interest deductions, asset basis items, and long-lived intangibles: the retention clock runs from the year the item actually affects your tax, which can be well after the cash changed hands.

Because international information-return issues can keep a year open, and because related-party items often have long tails, most foreign-owned LLCs are best served by a conservative, well-indexed retention policy rather than aggressive purging. Tie each record set to the latest year its numbers influence, and don't dispose of anything still inside an open limitations window. Our /guides/monthly-compliance-routine includes a retention-tagging step so files are labeled with the year they stop being relevant.