Taxes: Can you write off purchases from Craigslist?

Question

I found a good deal on a camera for my photography business on Craigslist. The seller wants to deal in cash, no receipts. Can I still claim this as a business expense without a receipt? If the buyer writes me a receipt from his "personal business", does this count? Do Paypal transactions count?

Answer 1

Yes, you can.

If the seller will not write you a receipt, then you need to document the expenditure.

Go to your bank and write a check to cash for the exact amount of the purchase and write on the check what it is for as well as in your check register. Get the name, address, and phone number of the seller.

Write you own receipt, sign it and date it. Put a note on it that the cash was taken from your checking account with the check number noted. Put the serial number of the equipment on the receipt too.

When you get home, take a photo of the item and store it with the receipt and other documentation.

If you have insurance, add the item to your policy including the serial number.

This is no guarantee that the IRS will not question the expenditure, but at least you have documented the purchase as best as is possible.