Proof of Payment: Canceled Check or What?
Keeping proof of payment for all expenses is essential for tax deductions. But what if technology has moved past canceled checks? The either/or dilemma is often between finding the original check (difficult) and using a modern method (easier, if compliant).
Proof of payment alone isn't enough; you should also have an invoice or receipt to show what you purchased. Your supporting documents for expenses include canceled checks, account statements, invoices, and credit card slips. For small cash payments, use a petty cash fund and keep the slips. This adherence to detail is a Simple but effective way to ensure your expense deductions are bulletproof.
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DISCLAIMER: This content is for educational purposes only and should not be considered personalized financial advice. Always consult with a qualified financial professional before making financial decisions.