Which receipts you actually need to keep, and for how long

"Keep your receipts" is advice everybody gives and almost nobody qualifies. Keep which ones? For how long? Does a photo count, or do you need to hang on to the paper?

Most people answer those questions by keeping everything forever, out of a sort of vague anxiety. The actual rules are more specific than that, and knowing them is the difference between a filing system and a pile. What follows isn't tax advice, but it is what the IRS publishes.

How long you have to keep them

The general rule is three years from the date you filed the return. That's the window in which the IRS can normally assess additional tax, and it covers most people in most situations.

There are longer windows for particular cases. If you understated your income by more than 25 percent, it stretches to six years. If you're claiming a loss from worthless securities or a bad debt deduction, it's seven. And if you never filed a return at all, or filed a fraudulent one, there's no limit.

Employment tax records, if you have employees, run four years from the date the tax was due or paid.

The $75 rule, and what it doesn't mean

This one gets misquoted constantly. For travel, entertainment, gifts, and listed property, the IRS doesn't require documentary evidence for expenses under $75. Lodging is the exception, and you need a receipt for that whatever it cost.

What people tend to hear is "I don't need to record anything under $75," and that isn't it. You still need a written record of the amount, the date, the place, and the business purpose. The rule drops the paper slip, not the record.

Honestly, for most contractors the simplest policy is to keep everything anyway. Digital storage costs nothing now, and working out case by case whether a given receipt crosses a threshold takes more effort than just photographing it does.

Photos are fine

You don't have to keep the paper. The IRS has accepted electronic storage for a long time, as long as your copies are legible and complete and you can produce them when somebody asks.

That last part is where people come unstuck. A folder of photos on a phone that later gets lost, or a shoebox in a basement, satisfies "I kept it" right up until the moment you need one specific receipt from nineteen months ago.

What I'd actually do

Photograph the receipt while it's still in your hand and attach it to the expense it belongs to. Let that record carry the date, the amount, the merchant, and the purpose alongside the image. Retention then takes care of itself, because everything is already filed against a tax year.

That's how receipts work in Whittle. The photo stays attached to its expense, it's only ever served to people inside your own account, and pulling a year back out is a filter rather than an excavation. If you want to start that habit, the free plan is enough for it.

When a year does need to go somewhere, to your accountant or because a letter arrived, the reports page on the paid plans has two things built for it. A substantiation check lists what's still missing for the year: expenses without a receipt, meals and travel without a business purpose, anything uncategorized. And the audit binder prints the whole year, each expense on its own page beside its receipt, with a fingerprint of every receipt file so a copy you hand over later can be checked against the one on record.