Trying to find all those misplaced receipts for your taxes? Originally published in March of 2010, this article is just as timely now that we're in the midst of tax season. We've updated it with some additional articles on current receipt scanning technology.
Gregg Marshall, president of Rep Connection Inc. and a frequent traveler, shows you how to make the most of the digital age with this timely article on an efficient and easy way to keep track of your expenses.
If you travel for business, whether you own the company or work for someone else, you have to keep track of your expenses. If you are the owner, that "boss" called the Internal Revenue Service is likely to ask for your travel and entertainment expense documentation. If you work for a company, they'll want an expense report before reimbursing you for your expenditures.
Keeping track of expenses is a royal pain. For years I used an envelope and when I got home, or on the plane ride home, I'd sort the receipts and enter the results into a spreadsheet. If I lost my receipt, I'd usually never get reimbursed since I didn't remember to put it on the spreadsheet. And, of course, some of the thermal cash register receipts had been baked in a rental car, making them almost unreadable.
There really is a better way. I ran into a program called Neat Receipts (www.neatreceipts.com) that comes with a nice portable sheet fed scanner that can take receipts, documents to save, even business cards. It seemed like total overkill that the program installed a full runtime Microsoft SQL database, but what the program can do is worth the overhead.
If you scan a receipt, say from Office Depot, it keeps the image for the IRS. It then converts the image to text using optical character recognition. Then, knowing the receipt is from Office Depot (because it recognizes the name), it can automatically determine the format of the receipt and enter the right amounts for office supplies and taxes, etc. The program seems to have a large collection of receipts it can automatically recognize so when you scan one, all the work, even down to classifying what expense category the receipt is for, is done automatically.
When you get home, you can print an expense report, or export the data to another program. You can also print various reports for any period, such as the whole year, to keep in your records. It saves the images, so if at some future time someone (like the IRS) wants to see the receipt you can bring it up on your screen and/or print it.
As I said before, the program also comes with software that can scan business cards directly into your contact management system, such as Outlook. Or you can scan documents and save the images. Why does anyone keep track of expenses any other way?
Gregg Marshall, CPMR, CSP, is president of Rep Connection Inc.