20.28 Proving Travel and Entertainment Expenses

To satisfy the IRS requirements and to substantiate your expense deductions in the event of an audit, you need two types of records:

- - - - - - - - - -
image Planning Reminder
Credit Cards
Credit card charge statements for traveling and entertainment expenses meet the IRS tests, provided the business purpose of the expense is also shown. Credit card statements provide space for inserting the names of people entertained, their business relationship, the business purpose of the expense, and the portion of the expense to be allocated to business and personal purposes. These statements generally meet the IRS requirements of accounting to your employer for reimbursed expenses (20.32), provided a responsible company official reviews them. However, you need a receipt for lodging; the IRS will not accept a credit card statement as substantiation of a lodging expense.
- - - - - - - - - -
1. A computer log, diary, account book, or similar record to list the time, place, and business purpose of your travel and entertainment expenses; and
2. Receipts, itemized paid bills, or similar statements for lodging regardless of the amount, and for other expenses of $75 or more. But note these exceptions:
  • A receipt for transportation expenses of $75 or more is required only when it is readily obtainable. For example, for air travel a receipt or a boarding ...

Get J.K. Lasser's Your Income Tax 2013: For Preparing Your 2012 Tax Return now with the O’Reilly learning platform.

O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.