Do I really need to keep all those receipts??

Often overlooked, receipt keeping is a critical part of accurate small business bookkeeping. Receipts provide the most direct and acceptable support for every entry recorded in your financial records and tax returns.

In the event of an IRS audit, your business must show documentation proving not just the amount paid—but that the expense was a qualified business expense.

Many business owners mistakenly assume that bank or credit card statements are sufficient. However, these statements often lack the level of detail needed. The IRS may disallow expenses that don’t include full itemization or proof of business purpose.

The solution? Save itemized receipts and annotate them when necessary. A simple receipt with a few notes could make all the difference in maintaining compliance.

Acceptable forms of documentation include:

• Invoices
• Cash register tapes
• Cancelled checks
• Account statements
• Petty cash slips and ledgers
• Itemized receipts with vendor name, date, and payment method

While tracking and coding receipts may seem time-consuming, it can save your business significant time, stress, and financial penalties down the line.