Holding onto your receipts might not seem like a big deal at first, but it can help you get funded, shrink your tax bill, encourage better financial habits and give you peace of mind.
If you’re new to the business of farming and aren’t used to doing things like deducting business expenses, submitting insurance claims or doing your monthly bookkeeping and accounting, holding onto your receipts might not seem like a big deal.
But the truth is that holding onto every receipt, no matter how small–yes, even when your seed, fertilizer or hay guy doesn’t offer you one–doesn’t just save you money. It’s also the lifeblood of any good accounting system, helping you figure cost of production and profitability, borrow money, professionalize the business and insure the business against disaster.
1. You’ll pay less in taxes
Almost everything you do in the course of your business is deductible–from the vehicles and equipment, to the fuel and supplies, to the personnel and the overhead. Throwing away your receipts could mean you’re leaving hundreds or even thousands of dollars in deductions on the table.
Saving your receipts makes it easier to identify easy-to-miss deductions in the first place, cuts down on the amount of billable time you spend filing taxes with your accountant, and makes it easier to prove these expenses to the IRS later on.
Read more: 8 Easy to Miss Tax Deductions for Farmers in 2025
2. It takes the guesswork out of running your business
Tracking your cost of production is one of the biggest challenges when running a business–how else can you know whether you’re pricing your products the right way or turning a profit?
Holding onto your receipts lets you do just that, helping you verify input costs, track them from month to month, and track your progress against annual budgets and plans.
Keeping your books on a regular basis takes you one step further than that: instead of getting a peek at your cash flow every time you crack open that drawer of receipts, logging them regularly lets you keep track of how things are going on a monthly, weekly or even daily basis.
Read more: Why Managerial Accounting is Important
3. Banks, insurers and the USDA will give you more money
Many grant and loan programs require that your business has some kind of financial track record, which can be difficult to establish without documenting your expenses.
If you get government livestock or crop insurance and ever want to collect on a claim, you’ll need to keep detailed financial records. Same goes for getting emergency or disaster assistance from a government agency: those are usually based on the pre-disaster value of your property, which can be difficult to establish without a paper trail or receipts.
4. It encourages good financial habits
Documenting your expenses doesn’t just help you in the short term: it also encourages good financial practices and helps professionalize the business in general. Holding onto your receipts makes it easier to do your bookkeeping, facilitates a smooth month-end routine, and promotes better recordkeeping habits.
5. It’s easier to deal with returns, exchanges, recalls and rebates
Receipts make it a whole lot easier to deal with your suppliers if you ever change your mind about a purchase, or if there’s ever a problem with the goods you’ve been sold. If your vendor forgets to apply a discount to your purchase or issues a recall, having a receipt for your purchase can save you a lot of time and stress.
How to make keeping and storing receipts easier
Get automated receipt-scanning software
We recommend choosing a bookkeeping tool purpose-built for agriculture like Ambrook, which comes with a mobile app that can scan receipts and invoices automatically and create digital copies of them for easy storage.
Get a dedicated business payments card
Open a dedicated checking account and get a separate credit card for your business purchases–or better yet get a dedicated business spending card like the Ambrook card, which comes with the added benefit of automated bookkeeping functionality and powerful analytics tools.
Get Ambrook
Ambrook is purpose-built for farm accounting, making it easy to categorize and track personal and business expenses while giving you unparalleled insight into your operation’s performance.
With powerful bookkeeping and smart tagging functionalities, dedicated payment cards, automatic expense reporting, and a custom chart of accounts that grows with your business, Ambrook gives busy operators everything they need to get financial clarity now. Interested in learning more? Start your 7 day free trial today.
This resource is provided for general informational purposes only. It does not constitute professional tax, legal, or accounting advice. The information may not apply to your specific situation. Please consult with a qualified tax professional regarding your individual circumstances before making any tax-related decisions.
