Saving the Receipts: What to Keep and What to Toss

September 13, 2019

Most receipts you’re
given by the cashier don’t need to be saved. However, not all of them are
destined for the recycling bin just yet.

Here are the receipts
you absolutely should keep, and those you can comfortably throw away.

Save Receipts for
Taxes

There are some expenses
that you can write off in your taxes. As such, be sure to check what is and
isn’t a possible deductible.

Your new computer may
count as a business expense. That money you donated to your local shelter could
be a charitable write-off. If you’re unsure if it’ll count as a deduction, keep
it anyways. You’ll need records to prove that it cost as much as you claim.

However, typical
groceries are unlikely to be write-offs, so you can toss those receipts away.

With that said, some tax
deductions vary from state to state, so always look up your local laws!

Assets

Assets make up your
total “worth” as a tax-paying citizen. This can include your income, savings,
personal cars, assessed property (like real estate), stocks, and much more.

Any time you purchase an
asset, hold on to the receipt! In particular, there are some assets that the
IRS considers to depreciate in value with every year, which you can then write
off in your total net worth.

Child Expenses

This doesn’t apply for
feeding and clothing your child, but rather for tax-deductible expenses meant
to relieve the financial burden of a child, like childcare or helping pay for
secondary education.

Medical Expenses

You’re allowed to
receive tax deductions based on unreimbursed medical expenses. As of the
beginning of 2019, you can start deducting these once they exceed 10% of your
adjusted gross income. This only covers medically necessary expenses, however;
not adjustments in diet or cosmetic surgery. 

Bank Statements

Keeping bank statements
is especially important if you’re self-employed, or work a self-employed gig on
the side.

Bank statements can also
be an alternative way to provide a receipt for expenses if you no longer have
the physical receipt.

Tax Deductible
Donations

There are some
non-profits and other charitable entities that, when you donate to them, allow you
to deduct that amount from your taxes.

Most people don’t have
the ability to donate this much, but, nonetheless, you can only use this
deduction up to half of your total gross income. 

Recycling Bound

Daily purchases
typically will not be used or asked for when filing your taxes. This includes:

  • Groceries
  • Entertainment
  • Transportation

However, not all receipts are used for tax purposes! Depending on who you work for, if you’re on a business trip, you can be reimbursed for certain expenses. Make sure you look up what is and isn’t possible for reimbursement before you buy!