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How to Record Paypal Payments as Business Expense for Tax Purpose?

by markhere
7 replies
Since paypal now reports the income generated directly to the government, how to keep records of payments made through paypal as a business expense? Since no invoice is issued when buying a solo ad from a vendor or buying gigs from fiverr.
#business #expense #payments #paypal #purpose #record #tax
  • Profile picture of the author Tom Reed
    Originally Posted by markhere View Post

    Since paypal now reports the income generated directly to the government, how to keep records of payments made through paypal as a business expense? Since no invoice is issued when buying a solo ad from a vendor or buying gigs from fiverr.
    You don't need an invoice, these payments are recorded in your statement anyhow so there is a clear record of proof. Your bank statement and PayPal statement are the 1st line of record keeping while the receipts justify the expense.

    For example, charging a dinner proves the expense but the receipt is there to justify the expense. Buying solo ads and fiverr work is pretty much proof unto itself. Foolproof, maybe not but pretty darn solid... yes.
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  • Profile picture of the author vishwa
    You Can either search for the transactions and export them as excel (.csv) file. This will help you, I believe.
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  • Profile picture of the author kindsvater
    Export your PayPal payment transactions to a spreadsheet, delete non-business related items, and what you have left over is your deduction.

    To minimize taxes you should be claiming every business expense possible regardless of whether PayPal or someone else reports income to the government.

    .
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  • Profile picture of the author markhere
    Thank you guys for the replies

    Actually buying a solo ad just shows the name of the person so do I need to keep an extra record to justify the expense? Mostly solo ad vendors don't issue an invoice.
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    • Profile picture of the author Jill Carpenter
      You are allowed 2 paypal accounts.

      I have one for personal, and one is business.

      If you have a second one this can make it very easy to print the month up and then you'll have business expenses and profits all in one place.
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  • Profile picture of the author mrgoe
    I keep a record of the transactions, downloading all of them in spreadsheets.. worked so far for me, I`ve had no issues..
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  • Profile picture of the author Cobaki
    It is really annoying how you can’t get one automatically. But I gather my personal record of transactions by getting a spreadsheet version of them, too. I have never had problems doing this and for me, it is one of the simplest and the most accessible ways to do it.
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