Where do I file a receipt for an item with a warranty such as a copier that is also tax deductible for my home business? Should I file it into the Permanent or Tax section?
- If you rely on the papers in your Tax folders for computing your tax deductions, it is best to put the receipt into a Tax folder so you will remember to deduct the purchase. After calculating taxes, you may re-file the receipt into a Permanent folder for re-sale or warranty purposes. Alternatively, at the time of purchase, you may file the receipt directly into a Permanent folder while placing a duplicate of the receipt into a Tax folder - even just jotting a note with the item name and sale price will be enough for computing your taxes later on.
- If you rely on computer software or an expense book for calculating your tax deductions, file the receipt with the warranty into a Permanent folder under Warranties (after entering the transaction into your software program or expense book log).