Saving receipts for Tax Purposes--ideally answered by an Accountant or knowledgable tax person for small busin

Question

Hi:
I have a small business and buy a fair number of books over the internet related to my business. Since these are transactions that show up on my credit card bill, I usually record them in an Excel worksheet for tallying up at year end [and save my credit card statements]. Is that enough or should I be printing out a receipt from purchase e-mail confirmations as well?
thanks for you help

Answer 1

You should print out the receipts/invoices as well. In the event that you are audited, NOTHING impresses the IRS folks more than garguantan amounts of well-organized documents.

A business associate went through a 'random audit' a few years ago, for his and his wife's residential rental property business. They showed up for the appointed audit at the local IRS office, each carrying a banker's box full of files and documentation. After randomly picking through files for a few of the rental units and checking the documentation, the auditor smiled and said "Well, I think I've seen enough. You are well supported with your deductions."

The audit ended on the spot.

Answer 2

Save all receipts. Attach the receipts to the CC statement and make a note on the back of what the purchase was for. Print out copies of on-line transactions or the confirmation e-mails.

The spreadsheet is OK for crunching the numbers but you need the receipts. Nothing gladdens the heart of an accountant (or bugs a greedy IRS auditor) more than well organized receipts.

Answer 3

Legally, you don't need reciepts that are under $75. However, it is best to save them to prove your deductions.