Clear photos or scans are generally enough, as long as they show everything on the original and you keep them for as long as the IRS can ask, usually 3 years after you file. IRS Publication 583 (December 2024) says electronic records must meet the same requirements as paper ones, and originals may be destroyed once the storage system has been tested, under Revenue Procedure 97-22. ProfitDrawer's Expenses tab has a receipt link column for each payment.
What a usable receipt image shows:
- The date and the seller's name
- The amount paid and how it was paid
- What was bought, itemized where possible
Add a note of the business reason when it is not obvious, for example a meal with a client. IRS Publication 583 points out that proof of payment by itself does not establish that you are entitled to a deduction, so the receipt and the reason together matter.
Good habits:
- Photograph paper receipts the same day; thermal paper fades.
- File images in one folder per month and back them up in a second place.
- Paste the file link into the receipt column of your expense record.
How long to keep them: generally 3 years from filing, 6 years if you left out income over 25% of the gross income shown on your return, 7 years for a bad debt or worthless securities loss, and at least 4 years for employment tax records.
General information, not tax advice.
Source: IRS Publication 583: Starting a Business and Keeping Records · Updated
Tools and spreadsheets for this
Related questions
- How long should a small business keep tax records and receipts?
- How do I keep track of business expenses as a small business owner?
- How do I keep track of business expenses in a spreadsheet?
- What should I give my accountant at the end of the year?
- How do I see the version history of a Google Sheet?
- What is cash flow in a small business?
All questions on ProfitDrawer Answers →
General information, not tax, legal or financial advice. Check the rules for your state and your situation.