Do i have to record sales for taxes?

Question

As self employed, i know i have to have a receipt for stuff i buy like inventory do i need receipts for stuff i sell also?

Answer 1

You must keep accurate records of all of your income and expenses. That is required by law!

You should issue receipts for all of your sales and keep receipts for all of your expenditures. These are the source documents that will prove your claims if you are audited. Without accurate records and an audit trail to back up the records you'd be at the absolute mercy of the IRS should you be audited.

Copies of sales receipts are as important as expense receipts when it comes to an audit. If the IRS alleges that you made more money than you claim you did but you have complete and accurate records backed up by sales receipts for all of your income they will back off and leave you alone.

The fastest and best way to stop a tax audit cold is to show up with complete, accurate records fully backed by the source documentation, i.e. all receipts. When an auditor sees accurate records the probability of collecting extra tax quickly drops to zero. Since their performance is evaluated based upon the amount of extra tax collected vs the time involved in the audit they'll quickly move on to the next target and leave you alone.

Answer 2

You should give your customer a receipt and record the sale in some sort of bookkeeping system.

Answer 3

yes. depending on what you're selling you may be required to collect sales tax & report that quarterly. Check with your state tax department.

Answer 4

Your records will suffice for that, but you need to have a very good record-keeping system.

Answer 5

its not actually a reciept,but you should keep a voucher with you when you sell goods,in order to know about the transaction you did and to account it without any faliur