Every business expense needs documentation that shows four things: the amount, the date, the vendor, and what was purchased. A receipt from the hardware store showing “$127.43 for electrical supplies” on March 15th covers all four. A credit card statement showing just “$127.43 at Home Depot” doesn’t tell the IRS what you actually bought.

Receipts are the gold standard. Take photos with your phone and save them digitally because paper receipts fade and get lost. Apps can pull receipts directly into QuickBooks Online, which makes retrieval easy if you’re ever questioned about a deduction.

For meals and entertainment, you need additional documentation. The IRS wants to know who you met with, their business relationship to you, and what business was discussed. Write this on the receipt or add a note in your accounting software. “Lunch with Mike - discussed framing bid for Johnson project” is enough. Without that context, a restaurant charge is just a restaurant charge.

Mileage requires a log showing the date, destination, business purpose, and miles driven. Recreating this from memory at year end doesn’t work. Use a mileage tracking app or keep a simple notebook in your vehicle. The IRS expects contemporaneous records, meaning you logged the trip when it happened, not eight months later.

Travel expenses need records showing the business purpose of the trip. Keep your conference registration, meeting agenda, or client appointment details alongside hotel and flight receipts. A Mid-Missouri bookkeeper can help you set up systems that capture this information as trips happen rather than scrambling to reconstruct details later.

Bank and credit card statements help verify amounts and dates but they’re not proof of business purpose by themselves. They support your receipts rather than replace them.

If you lose a receipt, document what you can remember as soon as you notice. Note the approximate amount, what was purchased, and the business reason. This won’t always satisfy an auditor, but it’s better than nothing. The IRS allows some reconstruction of records when originals are unavailable, though they’re more skeptical of larger expenses without documentation.

Keep records for at least three years after filing. If your return understates income by more than 25%, the IRS has six years to audit. Some accountants recommend keeping records permanently for major purchases and anything related to business assets.

The easiest approach is capturing documentation when the expense happens. Take the photo, note the business purpose, and move on. Waiting creates backlogs where you’re trying to remember what a $43 charge was for three months ago. Monthly bookkeeping that happens in real time catches missing documentation while you still remember what the expense was for, instead of discovering gaps months later during tax prep.