How do you track your reciepts? How do you file them and organize them? Whats the best routine?
Put them in an envelope and categorize them according to the IRS tax form.
i don't save receipts. i make all of my business purchases on 1 credit card and save those statements digitally. then i go through each statement and categorize all of the expenditures. it may not pass an audit, but that is just the way i have done it for years now.
> How do you track your reciepts? How do you file them and organize them? Whats the best routine?
Plan ahead.
Years before I went into business for myself, when I was still a crew chief, I married the accountant/office manager from the surveying firm we worked for. So my system is to just give everything to her.
Forget receipts. Make up everything except trackable items like interest income and expense and 1099's. Huge time saver.;-)
All payments by computer check get catagorized per Schedule C (ads, auto, communications, supplies, etc.) using Quicken Home & Business when I write them. Credit card, checkbook, and cash purchases get catagorized when I get back to the office and the category written on the receipt. Receipts go into a file folder of the same names for the calendar year, then get put into a 9"x12" manila envelope similarly labeled for archiving with my other records for that year. After about 5+ years, I dispose of the receipts, excepting those for fixed assets.
We (my accountant/wife) enter all expenditures, etc. into Quickbooks (in appropriate categories) and file the receipt itself by year. My wife is an excellent accountant, especially since she is an RN (nurse) by profession!
I have moved from stuffing into a shoe box to stuffing into those poly file containers with a handle.
We organize and do the totals a few days before the totals are entered into TurboTax.
The easiest thing I've done is buy everything I can (gas, hotels, supplies, etc ) with a company credit card. My wife categorizes the monthly statement and the cleared checks into Quickbooks each month. She then downloads the info once a year onto a disc and gives it to the accountant.
I don't need no stinking software....
I stuff all the receipts in a hanging folder.
At tax time (tonight), I go through and throw them in different piles (supplies, repairs, postage, etc); then add up each pile, staple together and type the totals into the proper form using the irs.gov PDF forms.
Print them out and send them in.
I have a bookkeeper that comes in once a month and goes through receipts, enters them into appropriate categories in Quickbooks (subject to review at the end of the year). Also have a business credit card which I pay off every month, and receipts associated with expenditures on the credit card are entered in a similar way. Checks are processed in Quickbooks directly. All receipts are saved, and stored by year, with sub-filing based on vendor name. At home, I also track personal expenditures, and store receipts by year, with sub-filing based on the date of the receipt, by month. I think I prefer slightly the filing by month rather than by vendor name, but this is not a big difference.
I would advise you to keep your receipts in case of an audit. Sometimes a receipt gets lost, but I think having 90% of the receipts available for review by IRS goes a long way towards lending credibility to your audit response. I've never experienced an audit. At least, not yet.
I have considered purchasing a product called Neat Receipts to scan and organize receipts, but I suspect its not a big time saver.
There are applications on various smart phones that will allow you to take pictures of receipts and email them to a database. Again, I'm not sure this is a big time saver.
Finally, I have recently become aware of a budgeting software called You Need A Budget (YNAB). I have begun using this software to budget personal transactions. Some users describe their reliance on this software for business budgeting. However, for business purposes, I don't think its intended to be a replacement for Quickbooks, etc. rather a parallel process. What's nice about it is that it sort of forces you to forecast what you're going to spend your money on (make a plan) and then stick to it (as long as you keep up with the data entry.). I know you didn't ask about budgeting, but I thought I'd mention it.
