NASE Blogs

Record Keeping Rules

Jan 13, 2010

Q: I’m starting a pet sitting business this year. Can you tell me what kinds of records I should keep for tax purposes?

A: Congratulations on your new business and welcome to the world of self-employment.

Different kinds of businesses must keep different types of records for federal tax purposes. For your specific pet sitting business, here’s a general checklist of the receipts and records you should keep.

To document your income, keep bank deposit slips, invoices issued to customers, a receipt book if you accept cash as payment, credit card slips (if you accept payment by credit cards) and any 1099-MISC forms issued to you by clients.

To document your expenses, keep canceled checks, credit card receipts and notes for any small payments you make with petty cash.

You also need to keep statements for your business checking and savings accounts. In addition, you need to maintain a mileage log for the use of a vehicle in your business. And you may need to keep operational records for your house if you qualify for
the home office deduction.

For more detailed information, see IRS Publication 583, Starting a Business and Keeping Records.