Missing Business Receipts

[pidgeotto101]

I have a new farm small business and I'm filling out Schedule F for my return. I was going through our bookkeeping and found several expenses with receipts I can't find at all.

I would say about maybe 5% of our expenses are missing receipts. They vary in amount from $10 up to $1200. Unfortunately, they are not just travel expenses, but also are cost of goods sold and operating expenses. On the other hand, they all show up in our bank statements with date, merchant name, and amount (but not itemized of course).

Does anyone have any advice if I should still include these expenses in my tax return? I can't find any material on what the status quo is for these situations. Surely most businesses have a few receipts fall through the cracks now and then - what do most folks do in these situations when it comes to taxes?

[ThomasM125]

You are probably not going to get into serious trouble for entering expenses on your tax return that you can reference to a bank or credit card statement, assuming they appear reasonable. However, it is possible that they could be denied in the event of an audit. So, if you do report them on your tax return, keep whatever documentation you have supporting the deductions, but be aware that the expenses could be denied in the case of an audit.