Proving business-related expenses is necessary for a business to qualify for tax deductions. The IRS requires that a business be able to show a tax receipt with a description of the purpose of the expense in order to obtain the deduction. Individuals also need business receipts to receive reimbursements for their business expenses. Sometimes receipts get lost or misplaced. There are other ways for individuals and businesses to be able to prove their costs in order to receive the reimbursements and deductions.
Attempt to obtain duplicate copies of lost business receipts. It should be easy to request copies of bank statements and invoices from vendors. These documents will have useful information in proving business expenses. They will list dates, companies and amounts spent. Credit card companies will also send duplicate bills to help prove expenses. You can also call individual companies if you remember the date of your visit. Bigger companies can print off duplicate receipts from their computers based on date and time information.
Reconstructing the information that would have been included in the lost business receipts is another option. This can be done by looking at calendars and confirmations from different places. These sources will give the dates, names of facilities and money spent on the business expenses. All this information can be submitted to an employer with a reimbursement request. It can also be kept with business records to show the IRS in case of an audit.
The IRS does not require receipts for business expenses under $75 unless the expense was lodging. However, even for the minimal business expenses, you still need to record the date, time, place, name and business purpose for the expense. This information would have to be submitted to the IRS during an audit. Employers will still want receipts for minimal expenses in order to process reimbursement requests. Some employers may waive the lost receipts if other documentation is submitted that supports the minimal business expense.
The IRS grants waivers for individuals who have lost business receipts due to a natural disaster. The IRS will usually waive penalties for late filing and payment of employer tax bills. These waivers are typically restricted to areas where federal disaster declarations have been made. The IRS also recommends sketching or looking at a picture of your business. By visualizing the area, you can piece together expenses that you might have missed.