A credit card receipt is a written record summarizing a credit card transaction that is either emailed or provided by a merchant directly in person. Credit card receipts contain key information about credit card purchases, and they are very important for budgeting and tax purposes.
We’ll go into more detail below, explaining what receipts to keep, whether or not you have to sign them, and tips for avoiding common mistakes.
What’s the Deal with Signing Credit Card Receipts?
Why do some merchants make you sign receipts while others don’t? Well, the practice of signing paper (and even digital) receipts exists for verification purposes – stores are meant to compare the signature on the back of a customer’s credit card with the one on the receipt, as a mismatch might indicate potential fraud. Even more importantly for merchants, the fact that they have your signature indicates they took reasonable steps to verify your identity, which in turn, protects them from being subject to chargebacks.
You may have noticed, however, that merchants often do not require a signature for low-cost purchases. That’s likely because these merchants are already shielded from chargeback liability through special subscription-based payment processing programs, or they simply prefer to eat the cost over obtaining and keeping signed receipts. That’s why buying a coffee at Starbucks generally does not require a signature, for example.
Should You Keep Your Receipts?
Below, we break down the different types of receipts consumers and small business owners should each keep as well as how long you should keep them for.
You should keep all of your receipts for five years from the date of purchase, as this will ensure you’re covered in the event of an IRS audit. Simply presenting your credit card statements will not suffice in such an instance.
There are a few other reasons to hold onto your receipts as well:
- Returning or Exchanging Items: While the bigger retailers may be able to look up past purchases in their internal payment systems, as long as you can provide the card used to make the transaction, many merchants will only allow returns and exchanges if you can present the original receipt.
- Using Product Warranties: You typically need a receipt to make a warranty claim on a covered purchase, such as electronics. Card networks also require receipts under their extended warranty programs.
- Taking Advantage of Price Protection Programs: If you have a credit card that offers price protection, you’ll need an original purchase receipt to get a lower-price refund.
- Reviewing Charges on Monthly Statements: Receipts enable you to cross-reference purchases down to the penny, which is important since merchants sometimes mis-key dollar amounts or attempt to outright overcharge customers.
Keep signed receipts for at least 18 months for chargeback protection purposes. Customers can dispute charges for up to 540 days after a purchase.
With that being said, payment processing programs such VEPS (Visa Easy Payment Service) and QPS (Quick Payment Service) protect merchants from chargebacks on small transactions – typically under $50. If your store participates in these programs, there’s no need to archive receipts for small transactions.
What Information Does a Credit Card Receipt Include?
A credit card receipt contains a lot more than just your name and signature. They convey a few other important pieces of information as well.
Your Shortened Credit Card Number
Also referred to as your PAN (primary account number), this number must be abridged in accordance with the Fair and Accurate Credit Transactions Act, which seek to protect consumer privacy. While your card’s expiration date and CVV cannot be displayed, handwritten or imprinted receipts may include this information.
Your store’s name, address and merchant location ID number must all be listed on a receipt.
Each transaction will be given an approval code, sent by the card issuer, which must be clearly displayed on a receipt.
The date, time and amount of a transaction must be displayed as well.
Tips for Avoiding Receipt Mistakes
Like any aspect of personal finance, there are mistakes to be made when it comes to handling receipts and many people inevitably make them. Hopefully, the following tips will help you steer clear of the biggest pitfalls.
Make Sure Your Bill & Receipt Match at Restaurants
Often times, employees manually input transaction and payment details, causing room for error (especially with split bills). So while your check may accurately state the total, the amount actually charged (displayed on your receipt) may be different.
Avoid Old-School Imprinting Machines
Although they’re outdated, some small stores still use imprinting machines and carbon paper to document credit card transactions. That’s dangerous since all of your card information is copied and stored, rather than just the last 4 digits of your primary account number.
Rip Up Unwanted Receipts
Once you no longer need a receipt, tear it up or feed it to your shredder before tossing it in the trash. This will make it harder for dumpster-diving fraudsters to steal your identity.
Verify & Keep Gift Card Receipts
When purchasing a gift card specifically, confirm that it has been activated properly by checking the transaction amount on your receipt. Having the receipt handy will also help you recover any unspent balance in the event your gift card is damaged, left blank or stolen.
Check Digital Receipts
Some stores offer the option of emailing your receipt, which can be convenient for tech-reliant consumers. If you opt for this method, confirm that you actually receive the email. If you have a smartphone, we recommend checking your email at the point of sale.
Don’t Leave “Tip” Blank
Always fill out the tip field on a receipt. For receipts that have a field for tipping, always fill it out. When tipping is not appropriate, write “0.00” or draw a line through it. This prevents others from adding tips you didn’t authorize.
Take the Customer Copy
Even if you don’t intend on keeping it (though we suggest you do), take the customer copy when you leave a store or restaurant. Since store and customer copies have the same information, unscrupulous merchants could technically fill in the tip section on the customer copy and charge you that inflated amount instead.