Missing receipt at or above $75
Checks that every expense of $75 or more, and every lodging charge at any amount, carries documentary evidence showing amount, date, place and nature of the expense.
- Employee
- Aaliyah Brooks, Account Executive, Bramblewood Logistics
- Merchant
- Hyatt Regency Denver (no folio attached)
- Amount
- $612.38
The report claims two nights at the Hyatt Regency Denver for $612.38 with only a card statement screenshot attached. The screenshot shows merchant, date and amount but no itemization of room rate, taxes or incidentals, so it does not meet the documentary evidence standard for lodging. The same report includes a $97.15 dinner at Guard and Grace supported by a terminal slip with no item detail and no attendees listed.
- Category
- Substantiation
- Default severity
- High
- Basis
- Treas. Reg. § 1.274-5(c)(2)(iii)
- Rule ID
- receipt-threshold-75
Why this rule exists
The $75 line is not an arbitrary company number. Treas. Reg. § 1.274-5(c)(2)(iii) requires documentary evidence, such as a receipt or paid bill, for any lodging expense and for any other expenditure of $75 or more. The evidence has to establish the amount, date, place and essential character of the expense, and the employee still records the business purpose.
A card statement line is not enough. It proves a payment happened, not what was bought. If reimbursements routinely go out without receipts, the arrangement stops meeting the substantiation requirement of an accountable plan under Treas. Reg. § 1.62-2, and the affected amounts become wages subject to income tax withholding and FICA.
Missing receipts are also expensive to chase later. GBTA research puts the cost of correcting a report with errors at $52 and 18 minutes, and finds about 19% of reports contain errors or out-of-policy items. Asking at submission, while the confirmation email is still in the employee's inbox, is far easier than asking three weeks later.
Detection logic
The steps the audit engine runs, in order, on every submitted line.
- 01
Evaluate each expense line in its original currency and in the reporting currency, using the card transaction amount where one exists, so a JPY 11,200 dinner is tested against the threshold at the posted exchange rate.
- 02
Treat any line under MCC 7011 or the 3501-3999 hotel range, and any folio-sourced line, as lodging, which needs documentary evidence regardless of amount under the regulation.
- 03
Confirm that the attached file is a real receipt, not a card statement screenshot, a booking confirmation with no payment shown, or a terminal slip photo that lacks any item detail.
- 04
Read the receipt for the substantiation elements: amount paid, transaction date, merchant name and location, and enough item detail to show the nature of the purchase. Any missing element is listed on the finding.
- 05
Match the receipt total to the claimed amount within $1.00 or 1%, whichever is larger, and send larger gaps to a separate mismatch finding rather than treating the receipt as missing.
- 06
Check whether a missing-receipt affidavit is attached, and whether the employee's affidavit count in the last 12 months exceeds the policy allowance, which defaults to three per year.
The drafted message
Clause-cited, specific and easy to resolve in one click. AP edits or approves it before it reaches the employee in Slack, Teams or email.
Phyto Nex AI, on behalf of Finance
Draft, awaiting AP approval
Hi Aaliyah, thanks for getting your Denver report in. Two receipts need a little more detail. The Hyatt Regency charge of $612.38 has a card statement screenshot, but Section 7.1 of the Expense Policy needs the itemized hotel folio for every stay, which the front desk or the Hyatt app can email you. The $97.15 Guard and Grace dinner needs the itemized receipt rather than the card slip. You can upload both here, add context if a receipt is truly unavailable, or mark either line as personal. Thank you!
Tuning tips
- Lower the threshold below $75 if your auditors or a customer contract require receipts on more items. Many government contractors set it to $25 or zero for contract charge codes while keeping $75 elsewhere.
- Allow digital receipts from integrated sources, such as ride-share and airline email receipts captured automatically, to satisfy the rule without the employee uploading anything by hand.
- Set the missing-receipt affidavit allowance per year and per role. Field staff who pay small vendors and parking attendants in cash often need a higher allowance than office-based staff.
- For VAT-registered entities in the UK and EU, require a valid VAT invoice rather than a simple receipt where reclaim is expected, because a card slip will not support the VAT claim.
- Exempt per diem meal and incidental claims paid under Rev. Proc. 2019-48, since the amount is treated as substantiated, but keep the time, place and business purpose checks switched on.
Related rules
Next: Late substantiation beyond 60 days- SubstantiationLate substantiation beyond 60 daysMeasures the time between when each expense was paid or incurred and when it was substantiated, flagging lines approaching or past the 60-day safe harbor for accountable plans.
- Meals & alcoholAlcohol without a client attendeeDetects alcohol on itemized restaurant and bar receipts when the attendee list has no external guest, so internal team drinks are separated from client hospitality your policy actually reimburses.
- Duplicates & fraudDuplicate expenses across cards and reportsFinds the same purchase claimed twice, whether on a corporate card and a personal reimbursement, across two corporate cards, or in separate reports filed weeks apart.
- Duplicates & fraudSplit transactions below an approval thresholdDetects purchases broken into smaller charges or reports that each fall under an approval limit but together exceed it, such as charges of $1,284.60 and $1,317.46 days apart.
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