Topics covered this week
- Verification
- Validation
- Vouching
1. Verification
Come tax time, the deductions that get denied in an audit usually aren't the ones that were wrong — they're the ones that couldn't be proven.
For any business expense over $75, the IRS wants more than just the bank or card transaction. Keep the receipt itself (not just the charge), and for meals or client entertainment specifically, note who you were with and the business purpose.
In QBO, the easiest fix is to attach the receipt directly to the transaction — either by forwarding a photo to your QBO receipt-capture email or uploading it right in the Banking tab when you categorize the expense. It takes ten seconds in the moment and saves you from digging through old email six months from now.
2. Validation
Fed Chair Kevin Warsh spent his first meeting back in June watching markets do his tightening for him — yields up, stocks down, volatility up. By his July 29 meeting, he even noted the markets had already done quite a bit of the Fed's work. Since then, Wall Street has basically done a 180: the S&P has jumped nearly 7%, volatility has dropped to the lows of the year, and junk-bond borrowing costs have come down — all while the Fed's benchmark rate hasn't moved and long-term yields have actually gone up.
That gap is interesting. Markets are acting like the coast is clear on rates, but the actual cost of borrowing long-term is still elevated, and inflation still doesn't feel fully tamed to me. Something to be watching over the next few months.
3. Vouching
Running a business is rarely a straight line. Some months the numbers cooperate, some months they don't — but the businesses that make it are the ones where the owner keeps showing up regardless of which kind of month it is.
Whatever you're pushing through right now, know that the work you're putting in doesn't disappear just because it isn't paying off yet. Keep going.
Until next week
