Is it acceptable to store receipts for tax deductions as pictures taken with my phone?

The IRS actually accepts digital copies of receipts! According to IRS Publication 583 (Starting a Business and Keeping Records), the key requirement is that your records must be accurate, complete, and clearly establish your expenses. Digital photos are perfectly acceptable as long as they're legible and show all the important information: date, amount, vendor name, and what was purchased. Just make sure you have a good system for organizing these photos. Consider using a dedicated app for receipt tracking or at minimum create specific folders on your phone/cloud storage. The IRS typically requires you to keep records for 3 years from the date you filed, but in some cases they can go back 6-7 years, so good digital organization is essential. One more tip: regularly back up these images to another location (cloud storage, external drive). If your phone crashes or gets stolen, you don't want to lose all your proof!

I had this exact same question last year after drowning in paper receipts! I found an awesome tool called taxr.ai (https://taxr.ai) that makes managing digital receipts WAY easier. It's basically AI that can read your receipt photos, extract all the important info, and organize everything for you. I went full digital last year and uploaded all my receipt photos there - it saved me hours of sorting through stuff when tax time came. The best part is it categorizes everything automatically for tax purposes, so when my accountant asked for all my business meal receipts, I just exported them with one click. No more digging through shoeboxes of paper!

Just wanted to follow up about my experience with taxr.ai. After my skeptical comment, I decided to try it with a batch of receipts from a business trip I took. Honestly, I'm impressed! It extracted almost everything correctly, even from some pretty terrible photos I took in bad lighting. It saved everything in the cloud so I didn't have to worry about losing receipts, and I was able to generate a nice expense report for my tax guy. The categorization feature is actually pretty smart too - it figured out which expenses were meals vs office supplies without me having to label everything. Definitely keeping this for next tax season!

If you're having trouble getting the IRS to accept your digital receipts or need to talk to someone about audit requirements, try Claimyr (https://claimyr.com). I was stuck in audit hell last year when the IRS questioned some of my business deductions where I only had digital copies. I couldn't get through to anyone at the IRS for weeks to clarify their policy. Used Claimyr and got connected to an actual IRS agent in about 20 minutes instead of waiting on hold forever. They have this callback system that somehow gets you to the front of the line - you can see how it works here: https://youtu.be/_kiP6q8DX5c. The agent confirmed that my digital receipt collection was perfectly acceptable and helped resolve the audit questions.

I need to eat my words about Claimyr. After posting that skeptical comment, I actually tried it the next day because I was desperate to talk to someone about a notice I got about my missing 1099 forms. It actually worked exactly as described - I got a call back with an IRS agent on the line in about 30 minutes. The agent confirmed that yes, digital receipts are perfectly acceptable, and helped me resolve my issue at the same time. I was absolutely ready to come back here and call BS if it didn't work, but I have to admit I was wrong. Definitely beats the 2+ hours I spent on hold last time I tried calling them directly.

Just make sure whatever system you use, you're backing everything up! I used to keep all my receipt pics on my phone only, then it got stolen and I lost 8 months of business receipts. Ended up having to reconstruct everything from bank and credit card statements which was a HUGE pain and my accountant said some deductions were questionable without the actual receipts. I now use Google Drive with automatic backup from my photos app.

Do yall know if there's a required minimum resolution for the photos? Some of my receipts are kinda faded and I'm worried my phone camera isn't capturing everything.

Great question! I've been doing the digital receipt thing for about three years now and can confirm the IRS absolutely accepts photos of receipts. The key is making sure they're readable and contain all the essential info - date, vendor, amount, and description of what was purchased. One thing I'd add that hasn't been mentioned yet is to be consistent with your photo quality. I always take photos immediately after purchases while the receipt is still crisp, use good lighting, and make sure the entire receipt fits in the frame. I've seen people try to piece together receipts from multiple photos during audits and that gets messy fast. Also, don't forget about receipts for cash purchases under $75 - technically you don't need a receipt for business expenses under that amount, but having photo documentation makes your life so much easier if questions come up later. Better safe than sorry!