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Take your tax receipts green

March 17, 2012

Green is obviously the color du jour on St. Patrick's Day.

Clover patch

But going green with your tax receipts by converting the paper to digital format works today and every other day of the year.

In fact, cleaning out your crowded tax files and putting the info on your computer or other digital device is such a good idea that it's today's Daily Tax Tip.

If you're wondering whether the Internal Revenue Service is OK with the change, the answer is yes.

The IRS actually has been accepting electronic and scanned receipts, bills or other tax deduction documents as proof of tax claims since 1997.

That year the IRS issued Revenue Procedure 97-22 as guidance to taxpayers on maintaining electronic books and records.  A follow-up announcement the next year, Revenue Procedure 98-25, has additional information.

What the IRS expects: The main thing, notes the IRS, is that the digital versions "exhibit a high degree of legibility and readability when displayed on a video display terminal and when reproduced in hard copy."

Basically, the IRS won't accept sloppy documentation in any form.

Want something more recent? Then check out page 2 of IRS Publication 552, Recordkeeping for Individuals.

Under the subheading Electronic records, the IRS basically says electronic methods of tax recordkeeping are just fine as long as you follow the same rules that apply to paper records.

That means the digital images must show the same information as the paper document and you must be able to produce the electronic copies if the IRS asks.

The IRS even produced a video discussing what it expects from electronic records.

So you've decided this is the year you clear out the clutter and transfer your tax document to an electronic format. 

Several smartphone apps enable copying of receipts and business cards connected to tax claims. Also check out Shoeboxed and NeatReceipts.

Transferring your tax paperwork to electronic versions could also pay off in added green in your bank account when you have the proper records to sustain your tax-cutting claims.

You also might find these items of interest:

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The More Tax Posts tab at the top of this page will take you to, well, more tax posts. You also can search below for a tax topic. 

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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