As a business owner,  it is important to keep copies of your receipts for business expenses.  Receipts serve as primary source documents for expenses.  They provide evidence that business expenses are ordinary and necessary and eligible for tax deductions, which reduces your overall tax liability and can potentially help you avoid tax penalties.  In addition, having receipts allows business owners to track their expenses and monitor where money is being spent, which is essential for budgeting and financial planning.

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In addition to keeping your receipts, it is important that the receipts are clear and legible.  They should clearly show the merchant’s name, date, amount and payment method on the receipt.  It is a good practice to include a note on the receipt indicating the business-related nature of the expense.  For any expenses related to travel, meals or gifts, the Internal Revenue Service requires that the business relationship of the people at the event are documented.

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Paper receipts can fade over time so it is best to have a system in place to scan all receipts and store them in a cloud storage system.  There are many affordable systems that will allow you to organize and store scanned documents, many times from your smartphone or tablet.  

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It is crucial to maintain accurate and complete records, including receipts, to ensure proper financial management and compliance with legal and tax obligations. Business owners should consult with a professional accountant or tax advisor for specific guidance tailored to the needs of their business and adherence to local regulations.

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