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Whether electronic or paper, supporting documentation is required  for all business affairs. 

 Small business documentation includes:

• Financial records like income receipts, asset records, balance sheets, general ledgers, tax returns, W9s, proof of tax credits, receipts for all expenses, and documentation with proof of business purpose for things like meals and travel.  
• Legal and operational documents such as business licenses, permits, contracts, and employment agreements. 
• Labor documents such as invoices for 1099 payments, W4s, I9s, and garnishment paperwork.   

Maintaining complete and organized records is crucial for operating legally, monitoring progress, preparing financial statements, and meeting Federal and state tax requirements.   

As a business owner, if you use a portion of your home solely for business, you may be able to take a deduction.

There are two ways to calculate the home office deduction: the regular method” and the “simplified option. The “simplified option” is a flat rate of $5 per square foot of the part of the home used, up to 300 square feet, for a maximum of $1,500.

The “regular method” deducts actual expenses based on the percentage of your home used, such as part of your mortgage interest, insurance, utilities and repairs.