Credit CardsJul 26, 2021
You must use a separate business credit card for business purchases. Do not use your personal credit card. The IRS does not approve of mixing business and personal purchases on the same credit card. Please provide a copy of the credit card statements to us and follow these guidelines:
- Create a separate envelope or manila folder for each credit card the business uses.
- For each credit card purchase, obtain a receipt. Record what the expense is for on the receipt and file it in the appropriate credit card envelope or folder.
- At the end of each month (or whenever you receive your credit card statement):
- Code each line on the credit card statement with the appropriate account code. Don’t forget to include any finance charges!
- Code the check. To do this, use the credit card statement detail to summarize the charges by account code and list the code and the respective amounts on the check stub. If the balance is being paid in full, the total charges will equal the payment amount. If you are paying more or less than the charged amount, simply code the difference to the credit card liability account. Send us a copy of the coded credit card statement.
- Staple the receipts to the original credit card statement and file them accordingly.
If you want to improve your business situation, get assistance now. Schedule your free consultation today or give us a call at (218) 491-4002. We're here to help!
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