What are the requirements for documenting business expenses?
For expenses to be allowed as deductions, you must show that you spent the money and that you spent it for a legitimate business reason. To prove that you spent the money, you generally need to provide documentary evidence that can be corroborated by a third party. Canceled checks or credit card slips are excellent evidence. To the IRS, third-party verification is important; if you pay business expenses in cash, be sure to get a receipt. Documenting a business expense can be time-consuming. The IRS is satisfied if you note the following information on the back of your credit card slip, or other receipt: o business purpose o business relationship (including names of persons present) o cost (itemized accounting) o time and place. Return to questions. 15. Deduct more of your unreimbursed business expenses. Unless you take the smart way out, your unreimbursed business and professional expenses can cost you a lot these days. Thats because theyre lumped under miscellaneous itemized expenses.
