title>Tax Guru-Ker$tetter Letter Wizard Animation

                 

Tax Guru-Ker$tetter Letter
Thursday, April 05, 2007
 
Keeping Records


Q:

Kerry,
 
I have perhaps stupid question - should I keep hardcopies / printouts of any invoices I generate from Quick Books and electronic invoices I receive for the stuff I buy in the corp? I don't do that at this point - I just make sure I have backup copies of my computer data. Is this enough?

Thanks

A:

One trend among tax pro offices is to operate as "paperless" by scanning in documents and keeping digital versions of them that can be printed out for or sent to IRS or anyone else who may request to see them. 

If you feel that you could produce those kinds of records from your digital info, there's no need to keep the hard copies.

From a practical perspective, the invoices you generate for your customers are not something that an IRS auditor would ask for.  They only care about money received via accounting for every penny deposited into bank accounts.  I can't recall any of them ever asking to see invoices that were sent to a client's customers in order to generate income. 

It's quite different for expenses.  Auditors do demand to see invoices for items purchased and deducted as expenses or set up as depreciable assets.

Kerry

 

 

 

 



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