The Check Clearing for the 21st Century Act (Check 21) became effective on Oct. 28, 2004. The bottom line on what it meant for most consumers is that you won’t be seeing any of your checks ever again after you send them off as payment with a bill or other statement. Instead, Check 21 allowed your bank to truncate each of your checks and create a new electronic negotiable instrument called a substitute check.

After doing this, your bank destroys your original check.

Check 21 changed the way you are able to prove an expense to the IRS in order to be entitled to a tax credit or credit.

For most taxpayers, Check 21 meant you needed to keep your past bank statements in good order — the IRS accepts bank statements that contain images of cancelled checks and/or substitute checks.

To be used as proof, an account statement must show check number, amount, payee’s name, and the date the check was posted.

In order to keep track of your payments more easily for tax purposes, you should also continue to or begin to maintain a careful check register. That way, you’ll know on which bank statement to look if you are ever audited.

Banks were not forced to jump on board to the new electronic Check 21 system. However, most chose to participate immediately after Check 21’s passage, and others are predicted to follow.

If you receive cancelled checks with your account statement, Check 21 for the time being will mean that you might begin to receive a mixture of cancelled original and substitute checks.

If you receive image statements (pictures of several checks on a single page), you also may notice that some of the pictures are of substitute checks.

The Check 21 law says you can use a substitute check as proof of payment because it is legally the same as the original check. The IRS, therefore, must accept your substitute check as proof of payment.

The IRS also accepts image statements of substitute checks as proof of payment. However, as has been IRS policy for image statements of cancelled original checks, if an IRS auditor is suspicious that the image statement is not genuine, you may still be requested to order the actual substitute check from your bank.

This will be a rare instance, however, and only if you are audited.

What if you do all your banking and bill paying online? The same rules apply. As a precaution, however, we suggest that you download and print out your bank statements at the end of the year.

That way, even if you are audited several years from now, you’ll have a record that’s easy to access.

Benny Jeansonne is a partner with the firm of Silas Simmons, LLP, Certified Public Accountants in Natchez.