The length of time you should retain the records will depend on the type of record it is. Here is a website (not my website, just one that looked good via a Google search) that breaks down the various types of records a business will have, how long a business should retain the various items, and the reasoning for the various timeframes. http://www.nolo.com/legal-encyclopedia/how-long-sh... Obviously, you will want to double-check the info with your accountant.
Most accounting software programs especially those online will allow you to scan and attach the receipt to the expense. These electronic receipts can be used to satisfy IRS requirements to produce supporting documentation. There are several apps available to assist you as well, check out Expensify.com or ReceiptBank.com for two options that are very inexpensive and provide an excellent method for keeping track of expenses.
The tax code actually favors small businesses. The best deductions and credits are reserved for these "job creators". Absolutely keep your receipts in case you have to prove your deductions to the IRS. I find that many business owners miss out because they don't take advantage of business deductions because they don't think they are deductible. Talk to your qualified tax professional.
If you ever have the misfortune to be audited, specific documentation of expenses is essential. We have had cases-especially with the State Revenue Departments that go back more than 10 years. We just resolved a $50,000 problem with Georgia that dated back to 2001. With his business receipts, we were able to file amended tax returns that completely eliminated his tax debt.
Esther, as technology advances so too do the options available for you to keep track of your receipts. I use a NEAT scanner for some of my small businesses that I run. There are also apps for smart phones that allow you to capture copies of your receipts. The IRS will accept scanned receipts so you can throw out the paper copies (but make sure your data is effectively backed up!)
Yes, save all your receipts! If they are on the thermal tape, I copy them, over time the thermal ones fade and become unreadable. Coping them saves your records! I have been to audits where if the receipt was unreadable, it is not used! I staple the original to the copy so I have both.
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Answers (11-20)
The length of time you should retain the records will depend on the type of record it is.
Here is a website (not my website, just one that looked good via a Google search) that breaks down the various types of records a business will have, how long a business should retain the various items, and the reasoning for the various timeframes.
http://www.nolo.com/legal-encyclopedia/how-long-sh...
Obviously, you will want to double-check the info with your accountant.
I hope this helps.
Yes, you should.
Most accounting software programs especially those online will allow you to scan and attach the receipt to the expense. These electronic receipts can be used to satisfy IRS requirements to produce supporting documentation. There are several apps available to assist you as well, check out Expensify.com or ReceiptBank.com for two options that are very inexpensive and provide an excellent method for keeping track of expenses.
Yes. I save all receipts for 7 years. You will need them if the IRS audits your business.
You must save your receipts, cancelled checks,bank statements and credit card statements( if used for business) for 7 years.
Save all pertinent documents for at least six years.
The tax code actually favors small businesses. The best deductions and credits are reserved for these "job creators". Absolutely keep your receipts in case you have to prove your deductions to the IRS. I find that many business owners miss out because they don't take advantage of business deductions because they don't think they are deductible. Talk to your qualified tax professional.
If you ever have the misfortune to be audited, specific documentation of expenses is essential. We have had cases-especially with the State Revenue Departments that go back more than 10 years. We just resolved a $50,000 problem with Georgia that dated back to 2001. With his business receipts, we were able to file amended tax returns that completely eliminated his tax debt.
Esther, as technology advances so too do the options available for you to keep track of your receipts. I use a NEAT scanner for some of my small businesses that I run. There are also apps for smart phones that allow you to capture copies of your receipts. The IRS will accept scanned receipts so you can throw out the paper copies (but make sure your data is effectively backed up!)
Yes, save all your receipts! If they are on the thermal tape, I copy them, over time the thermal ones fade and become unreadable. Coping them saves your records! I have been to audits where if the receipt was unreadable, it is not used! I staple the original to the copy so I have both.