Do creators need to track business expenses throughout the year?

Yes. Tracking business expenses throughout the year is essential for two reasons: it reduces taxable income (deductions are only available if claimed), and it provides the documentation the IRS requires to substantiate those deductions if the return is examined. Waiting until tax time to reconstruct the year's expenses from memory or bank statements is both error-prone and incomplete — many expenses are forgotten, and documentation is harder to retrieve months after the fact.

Different expense categories require different documentation. Equipment deductions require the purchase receipt, the placed-in-service date, and a log or record showing business use percentage (especially for mixed-use items). Home office deductions require square footage measurements, evidence of exclusive use, and records of the underlying home expenses (rent, utilities) being allocated. Contractor payments require the contractor's name, their taxpayer identification number (for 1099-NEC purposes), and the amount and date of each payment.

The practical foundation is a dedicated business bank account and business credit card used exclusively for business transactions. When all business income flows into the business account and all business expenses flow out of the business credit card, monthly bookkeeping becomes reconciliation against statements rather than reconstruction from receipts. Accounting software — even basic tools — can categorize transactions, generate profit and loss reports, and make Schedule C preparation significantly faster. Creators who mix business and personal expenses in the same accounts create unnecessary audit risk and make accurate tax preparation materially harder. IRS Publication 334 covers the documentation requirements for various expense categories.

This is general tax information, not tax advice. Your situation may differ; consult a licensed CPA before making tax decisions.