How to generate proof of expenses in an audit.
- October 2, 2019
- David Greene
- Comments Off on How to generate proof of expenses in an audit.
As you know the IRS will not accept your word for expenses. They want to see backup documents and proof of payment. If you did not keep receipts, you can order old bank statements from your bank and then go back through those bank statements and mark the relevant payments, noting what each was for. Another thing to do is visit the companies involved and ask for duplicate bills and receipts. I can help you with the audit and make other suggestions. For the future, IRS Publication 583 gives guidelines for keeping records and how long to keep those records. It suggests keeping most records at least 3 years, and some, such as those involving real estate, even longer. I personally think all financial records should be kept at least seven years. In this digital world, they can be kept digitally on hard drives or in the cloud. Of course, you should always have a backup to stored data.