Is Saving Credit Card Receipts Necessary?

May 21, 2014 by Ed Becker

Many small business owners use their credit cards as a way to keep better financial records. This is a great option because you can find any forgotten purchases when you reconcile your monthly statements. With cash purchases there are no checks and balances if you forget or lose your receipt.

Controlling your spending and keeping on top of financial records is tedious to say the least. And the mountains of paperwork that you save can become overwhelming. If you are using your credit card for most purchases many people believe that they do not need receipts.

Do I need to save all of those receipts from credit card purchases?

In most cases, no. But there are exceptions to every rule of course. When you do choose which receipts to save, make sure that you have a plan for filing and storing your financial documentation. Don’t be the accountant’s nightmare with a shoebox stuff with random receipts.

Receipts to Keep

• File receipts for purchases that have warranties. Once recorded the best option for these is taped or stapled to the owner’s manual so you can find it if you need it.
• ATM credit/debit card receipts should be kept until you reconcile your bank statement.
• For any items that you are claiming deductions for, should be kept for 3 years.

Receipts to Pitch

• Gas and vehicle maintenance receipts, if you use the standard deduction.
• Miscellaneous daily purchases that have been recorded as expenses.

You also could save time and space if you start scanning receipts, statements and other financial records. With free or cheap cloud storage, you can easily store years’ worth of information without fear of it getting lost or damaged by an accident in your home or office. There are document scanners that are very reasonably priced and easy to use. Or you can just simply use the scanner you already have and label everything into a cloud folder.

There is also differing opinions between accountants and financial advisors about what you should or should not keep and for how long. Since the IRS can only go back 3 years to audit someone, unless there is fraud involved, it makes sense that you really do not need to store all of your financial information for more than 3 years.

Just to be on the safe side, you should save your receipts that are for anything with a warranty, or that you are deducting for tax purposes. If you want to be super safe guarded then scan and save everything to cloud storage which you have access to from anywhere, anytime and it will not be lost in case of catastrophe.