|from Kimubert’s Photostream on Flickr|
Every sale you make should be recorded immediately, per IRS regulations. Here are a few simple ways to do this:
- Ring up every sale on a cash register and save the tapes.
- Save bank deposit slips. With each bank deposit slip, attach copies of all the checks received.
- Keep a receipt book. These are available in any office supply store.
- Save credit card charge slips that you receive.
- Collect all 1099-Misc’s. If you do consulting, many of your customers may issue you 1099-Misc’s. Save them.
Not every business needs to follow every one of these procedures. At a minimum, you should always save your bank deposit slips with photocopies of the checks. Keep additional records to provide details of your sales, especially of cash transactions.
For example, if you run a cash business selling small items, use cash register tapes and save your bank deposit slips. Amounts in the cash register tapes should agree to the bank deposit slips (total of each group of cash register tapes should equal the total of individual deposit slips).
A doctor’s office (which collects cash and checks only, no credit cards) can keep a receipt book and save bank deposit slips. Again, these should agree (total of each set of receipts equals the total amount of money on the deposit slip).
If you run a small consulting business, save bank deposit slips and collect your 1099-Misc’s in a file.
In short, each sale should be recorded somewhere, and there should be a separate record showing when it was deposited in the bank.
Read more here.