Keep your receipts to prove their validity to the IRS in the event of an audit. This post contains Amazon affiliate links. I may earn a small percentage if you click through and make a purchase.
TLDR: Log into Amazon, then go to Accounts & Lists > Your Account > Your Payments > Transactions – you will find a list of completed orders which includes the date, the last four digits of the card used, the order number and the amount charged!
Keep Your Receipts
It is a very good idea to build the habit of keeping all receipts for your business. You are responsible to retain all expense documentation, such as receipts, cancelled checks, or bills, legally required by the IRS to substantiate business deductions as “ordinary and necessary” for the business’ operations. Additional evidence is required for travel, entertainment, gifts, and auto expenses. Bank and credit card statements do not constitute sufficient evidence for expense deductibility under IRS regulations (for more information please see IRS Publication 535, Business Expenses).
If you are ever audited, the IRS can require you to show proof of anything you purchased and categorized it as a business expense.
Separate Business from Personal Purchases by Using Separate Payment Methods
If you purchase regularly from Amazon for your business, you should consider getting a business account since Amazon has reporting features available.
But if you are like me, and don't purchase much for your business from Amazon, it's perfectly okay to stay with your personal Amazon account to purchase your business items. I recommend that you enter a business card into your Wallet at Amazon for business purchases, so your transactions filter into your bank feed at QuickBooks Online. Don't make this card the default, just select it when you know you are making a business purchase. Always separate your purchases, being sure to buy personal and business in separate transactions so only business transactions come through into your bank feed.
Review Backup Payment Methods
One more thing – review your Backup payment methods and make sure your business card is not checked to be used for backup. If something should happen to your main default card, you could end up with personal purchases on the business card, and you want to avoid commingling.
Managing Your Receipts
My favorite way to manage my receipts is to attach them directly to the transaction in QuickBooks Online. If you don't want to take the time for this, you could save electronic receipts into a dedicated folder on your computer, or in the cloud: Google Drive, Dropbox, etc. I would discourage saving them in a shoebox as they will fade over time and could be useless in the event of an audit.
Best Way to Find Amazon Receipt Related to Specific Purchase and Card
Because I use my personal Amazon PRIME account to buy both personal and business transactions (separate orders), receipts are sent to my personal email inbox. For the longest time, that's how I found the receipts I needed to attach for my business transactions. I would put the word Amazon and the amount into the search field. e.g. Amazon 12.39. When the email was found, click open, then click on Order Number or View and Manage Order which would take me to Amazon orders. Then click on View or Print Invoice, Print to PDF and then attach to QuickBooks Online transaction.
This works pretty great most of the time, UNLESS Amazon breaks up the order and there are two different transaction amounts. Sometimes it can be hard to find the order.
I have discovered a better and 100% reliable way of finding transactions! Log into Amazon, then go to Accounts & Lists > Your Account > Your Payments > Transactions – you will find a list of completed orders which list the following information about each transaction: date, last four digits of the card used, order number and amount. Right-click on each transactions to open in another tab, then click on View or Print Invoice and print to PDF. Save to a folder you can find later easily, and the final step is to attach to the transaction at QuickBooks Online.
My Experience
I decided to write this blog post to share this information because I recently experienced what I thought was fraud on my Amazon account! I have an online side gig that earns a bit of money and the checking account rarely has over $200.
I logged into QuickBooks online to categorize transactions, solely due to (newly established) habit, even though I didn't expect there to be much activity. Well… as it turns out, there were three small purchases from Amazon!
And that's when I thought, “Oh! FRAUD PURCHASES!” I logged into Amazon and went to Your Account > Your Payments > Transactions and learned that my main credit card had expired, so the next card on the list to charge was the DEBIT card for my side gig business. Remember the one that I don't have much money in the account? And here are three purchases, gobbling away at the available cash.
I was so grateful to my new habit to categorize transactions weekly in QuickBooks Online because I was able to head off any insufficient funds fees that may have been coming my way. While looking at Your Payments > Transactions I also saw that three more purchases were pending and about to hit the checking account, depleting it even further. I added everything up and moved an “Owner's Contribution” from my personal checking to business checking to cover these unexpected, personal purchases.
Keep Your Wallet Up to Date
I decided it would be a good idea to remove this DEBIT card since I almost never buy anything for this company. And then decided to do some housecleaning on my Amazon Wallet. I had quite a few cards in there, a couple that I wasn't even sure how to access to pay the bill if they were charged, so I made a new rule for myself – if I don't recognize the last four digits of the card, remove it! I also saw that my sister's card was in there, as a few months ago she had asked me to make a purchase using her card (don't ask, long story LOL) so I removed that card as well. It would have been really bad if Amazon had decided to charge her card, and also embarrassing! In the past I have had coworkers who trusted me to have their card in my Amazon Wallet to make purchases for them as they just didn't want to bother with having an Amazon account. I am glad this situation never happened with one of their cards!
What is your favorite way to find your invoices at Amazon? Do you think you'll try this method?