by Sheila Askov
They create specific proof of the important 4 W’s: Where, When, What, and sometimes Why.
Credit card and bank statements alone are not sufficient proof in the event of an audit.
For example: A credit card charge on a business account at a big box store may show total charges of $4,000 and subsequent payment. Making the payment from your business account is not enough. Only the original receipt will provide enough details to satisfy the IRS.
In this same case, if you purchased items for multiple properties, uses, or projects, each of these details must be documented on the original receipt.
Buy your personal items separately. It’s much easier to track and justify business expenses when the items are used for business purposes only with the 4 W’s noted on the original receipt.
Your modus operandi can be a significant factor during an audit.
Keep it simple…Keep it separate…but KEEP THE RECEIPT!