Which Receipts Should You Keep? Some business owners keep every receipt they are given, others don’t keep any. Hopefully, you are somewhere in the middle. A basic rule of thumb is to keep proof of anything that can be deducted on your taxes. However, per IRS Publication 463, if the expense is less than $75 you do not have to keep the receipt unless it is for lodging.
How Long Should You Keep Them? In a regular audit, the IRS goes back three years. If you grossly underpaid your taxes, the IRS can go back six years. Six years worth of receipts could be quite bulky. Dropping a bag of paper on the auditor’s desk is probably one of the worst things you could do, so you want to make sure everything is organized.
Best Solution! The absolute best solution for retaining receipts is to “attach” them to the transaction in QuickBooks Online. This can be done by scanning or taking a picture. Please see the “Attachment” blog for more details. You can destroy the paper copy once the receipt has been attached. No more shoeboxes full of receipts!