Follow Proper Recordkeeping Requirements to Ensure a Smooth Tax Filing Process

The New York State Department of Taxation and Finance today announced the addition of new checklists to help taxpayers ensure they have acceptable proof for credits, income, deductions, and expenses claimed. The checklists, found on the Tax Department’s website www.tax.ny.gov (search: recordkeeping), cover: business loss; child and dependent care expenses; child and dependent relationship; college tuition expenses; itemized deductions; rental loss; self-employment income; taxi, limousine, or self-employed driver income and expenses; and wages and withholding. 

“The checklists serve a dual purpose,” said Acting Commissioner Nonie Manion. “They describe records taxpayers should keep to prove eligibility for the credits they’re claiming, and also what they must send to us if we request information to support their claims.”

Maintain accurate records

Good recordkeeping cuts errors and supports credits and deductions claimed. Tips below:

Keep bank statements, deposit slips, canceled checks, and invoices.

Business owners—including the self-employed—must compile records of each sale, including the sales price, the sales tax collected, cash register receipts, and credit card sales slip.

Records for the self-employed should contain enough information to accurately show the tax year’s gross receipts, business expenses, and the purchase price of assets and inventory.

The records should be kept for at least three years because the Tax Department may seek to verify the accuracy of records supporting credits, income, deductions, and expenses claimed on tax filings.

Click the following for additional information.
 
Recordkeeping for individuals

Recordkeeping for businesses

EITC recordkeeping tips for the self-employed

Source: The New York State Department of Taxation and Finance