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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 125003  
Subject: Re: Expenses - copies of receipts Date: 11/1/2000 6:05 PM
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<<Are copies of receipts good enough justification for taking business expenses for my S-Corp?

Or do I need to originals.

My client requires the originals. >>

I'm not sure that I follow. Simple receipts (either originals or copies) don't automatically allow a deduction. All deductions must meet the "ordinary and necessary" rules in order to be allowable.

For example, say I purchase a heart-lung machine for my tax practice. I keep the original receipt. Is this machine an "ordinary and necessary" expense for my business? Likely not...since I'm not performing any heart transplants in the office. So even with the receipt, it's likely that I'll receive NO deduction for the purchase of the machine.

See what I'm driving at?

Assuming that your expenses meet the "ordinary and necessary" rules, then the receipt/invoice AND a copy of the cancelled check (or other payment document) showing the actual payment should be fine.

I always recommend keeping the ORIGINAL invoice or receipt, that way there is no future hassle. IMHO, copies of the invoice/receipt should only be used when you can't get your hands on the original. Hopefully that won't happen often.

TMF Taxes
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