Receipts for Taxes: What Do You Need to Keep?

Justin is an IRS Enrolled Agent, allowing him to represent taxpayers before the IRS. He loves helping freelancers and small business owners save on taxes. He is also an attorney and works part-time with the Keeper Tax team.

Justin is an IRS Enrolled Agent, allowing him to represent taxpayers before the IRS. He loves helping freelancers and small business owners save on taxes. He is also an attorney and works part-time with the Keeper Tax team.

Across America, 1099 contractors and freelancers everywhere continue to stuff their wallets and glove compartments with paper receipts.

Keeping track of paper receipts is stressful. They're easy to misplace, tear, or smudge. And by tax time, the ink has likely rubbed off the paper — which might be little more than torn pocket lint by that point anyway.

Here's the liberating truth about paper receipts: they’re not your only option for recordkeeping. In many cases, they’re not even your best option.

What the IRS says about paper receipts

Freelancers often think they need physical receipts for every single tax deduction. That's actually a myth. To debunk it, we're going straight to the source — the IRS.

The IRS says to keep records for your business tax deductions indicating:

• What you bought
• When you bought it
• How much you spent

And guess what? It doesn't mention requiring paper receipts at all.

What to do if you get audited

If you do get audited after going paperless, don’t worry. The IRS is legally required to accept digital forms of proof for your write-offs, including bank and credit card statements.

Even if you forgot to document a cash purchase of over $75, you’re not completely out of luck. That’s where your digital breadcrumbs come in. If you’re able to rustle up, say, an email to a contractor discussing the cash payment you gave them, you can use this to reconstruct that expense.

At Keeper, we’re on a mission to expose regressive misconceptions — like the myth that paper receipts are the only acceptable kind of tax record.

At the end of the day, we hate seeing freelancers and contractors held back from getting the tax savings they deserve.

You can bet that corporations claim every tax write-off possible. So you should too. And antiquated recordkeeping practices should not be holding you back.

Justin W. Jones, EA, JD

Justin is an IRS Enrolled Agent, allowing him to represent taxpayers before the IRS. He loves helping freelancers and small business owners save on taxes. He is also an attorney and works part-time with the Keeper Tax team.

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