DHS Form 1501, the Purchase Card Transaction Worksheet, is the pre-authorization document a Department of Homeland Security cardholder fills out before every micro-purchase made with a government purchase card. It records the vendor, an itemized description of what you plan to buy, the cost, and the accounting codes that will be charged, and it must be signed by an Approving Official before the transaction takes place.1U.S. Coast Guard. DHS Purchase Card Manual The same form later carries your receipt-and-acceptance confirmation and becomes the core document in any post-payment audit.
When to Fill It Out
The worksheet is not a receipt log. Complete it before you place the order, no more than five business days before the purchase, and make the purchase within five business days of completing the form.1U.S. Coast Guard. DHS Purchase Card Manual Pre-filling dates is not allowed, with limited exceptions for recurring items or services. Unless your Component has an approved alternative, Form 1501 is the only authorized documentation method for a purchase card transaction.
Confirm your single-purchase limit with your Agency/Organization Program Coordinator before you start. The standard Federal Acquisition Regulation micro-purchase threshold is $15,000 for most supplies and services,2Acquisition.GOV. FAR 2.101 Definitions but individual card limits are often set lower based on role, and specialty categories (construction, service contracts, contingency operations) carry their own ceilings.
What to Enter on the Form
Start with the merchant’s legal name and the date of the purchase request. Then write an itemized description of every product or service you plan to buy, with quantity and unit price for each line. Vague descriptions cause problems in post-payment audits, so write enough detail that a reviewer who knows nothing about the purchase can tell what was bought and why. “Office supplies” is not enough. “24 blue ballpoint pens, Pilot G2, for Section B intake staff” is.
At a minimum, documentation for every transaction needs a description, unit number and quantity, the purchase amount, the merchant name, and the date you received the item.3GSA SmartPay. Purchase Training If the merchant’s receipt uses vague product descriptions, add your own supporting notes so the record is clear.
Accounting Classification Code
The Line of Accounting field takes an alphanumeric string identifying the fund, fiscal year, and cost center. An error here charges the wrong budget, triggers correction requests, and delays vendor payment. Verify the code with your financial supervisor against current fiscal-year guidance. Codes change between fiscal years, and reusing last year’s string is a common cause of rejected worksheets.
Block 37: Receipt and Acceptance
Once the goods or services arrive, completing Block 37 documents your proof of receipt and acceptance.1U.S. Coast Guard. DHS Purchase Card Manual If the final receipt amount exceeds the approved worksheet total by up to $100, DHS allows the overage provided supporting documentation shows the additional funds were available and approved before the purchase.
Check Mandatory Sources and Prohibited Items First
Before buying commercially, the FAR requires you to check whether the item is available through mandatory government sources, in priority order,4Acquisition.GOV. FAR 8.002 Priorities for Use of Mandatory Government Sources and micro-purchases are not exempt.5GSA SmartPay. GSA SmartPay – Lesson 5 Making Purchases The order for supplies is:
- Your agency’s own inventory.
- Excess from other agencies, through the federal excess property system.
- Federal Prison Industries (UNICOR).
- AbilityOne Procurement List supplies from nonprofit agencies employing people who are blind or have severe disabilities.
- Wholesale supply sources: GSA, the Defense Logistics Agency, or the Department of Veterans Affairs.
The form includes a certification that you checked these sources. Skipping it and buying commercially when the item was available through a mandatory source violates FAR Part 8 and can cost you card privileges.
Confirm the item is not on the prohibited list. Cash advances, gift cards, personal purchases, betting or casino chips, bail and bond payments, foreign currency, savings bonds, and wire transfers are banned outright regardless of dollar amount.6Acquisition.gov. Prohibited Transactions Pharmaceuticals must go through DLA. Telecommunications systems, video surveillance cameras, and ByteDance applications including TikTok are prohibited. Items containing certain PFAS chemicals, such as nonstick galley cookware or stain-resistant coatings on furniture and carpets, cannot be purchased with the card. Gift cards trip up cardholders most often because they look like a natural employee-recognition tool; they are treated as cash equivalents.
Submit It to Your Approving Official
Send the completed worksheet to your Approving Official before the transaction happens. The Approving Official verifies the purchase is legitimate, within your authorized limit, and compliant with mandatory-source and prohibited-item rules.7White House. OMB Circular A-123 Appendix B You cannot approve your own transactions regardless of your position.
If extenuating circumstances make pre-approval impossible, document in the purchase card file exactly why the normal process was not followed. Treat this as the exception. After the purchase, the Approving Official must still review and approve the transaction no later than 30 days after the end of the billing cycle date,7White House. OMB Circular A-123 Appendix B and you must reconcile your transactions within that same 30-day window. Missing this deadline is a Tier I violation.
Upload the signed form and all supporting documentation into your departmental procurement system or send it to the designated financial office. Keep the original merchant receipt, packing slip, and any vendor correspondence attached to the worksheet.
Don’t Split a Purchase to Fit
Breaking a known requirement into smaller purchases to stay under your card limit or the micro-purchase threshold is prohibited.8Acquisition.GOV. 14-5 Split Purchases A split happens when you know the full requirement at the time of the first buy and break it up anyway: multiple orders from the same merchant on the same day that together exceed your limit, similar orders spread across several vendors to keep each below the threshold, or several cardholders under the same supervisor buying the same item in a compressed timeframe. If the total requirement exceeds the threshold, send it to a contracting office. A first-time split is a Tier I violation; repeated offenses escalate to Tier II, meaning account suspension and mandatory retraining.1U.S. Coast Guard. DHS Purchase Card Manual
Disputes and Sales Tax
If a charge is incorrect, duplicated, or involves defective goods, you have 45 days from the posted date of the transaction to formally dispute it through the bank’s electronic access system.9Acquisition.GOV. 6-10 Disputes, Defective Items and Fraudulent Transactions Try to resolve the issue with the merchant first, and document every contact attempt. Miss the 45-day window and recovering funds becomes much harder.
Federal government purchases are generally exempt from state sales tax, but each state sets its own documentation requirements.10GSA SmartPay. Frequently Asked Questions Before you buy, contact the merchant to confirm what proof they need. Some states require a specific exemption certificate; others accept the card itself. If a merchant refuses to honor the exemption, ask them to contact their state taxation department, and in some cases you can reclaim the tax from the state afterward. GSA maintains a state-by-state lookup at smartpay.gsa.gov.11GSA SmartPay. Tax Information by State
Retain the Records for Six Years
Under General Records Schedule 1.1, financial transaction records for procuring goods and services must be retained for six years after final payment or cancellation.12National Archives and Records Administration. General Records Schedule 1.1 – Financial Management and Reporting Records Store the completed Form 1501 together with merchant receipts, packing slips, vendor correspondence, and any dispute records. Electronic files must be legible, logically organized, and accessible to auditors and the Office of the Inspector General. Failure to produce documentation for a post-payment audit is a Tier II offense and can result in account suspension.
What Happens If You Get It Wrong
DHS enforces a three-tier discipline structure for purchase card violations. Tier I brings a written warning and covers things like a first-time split, careless unauthorized purchases, or missing the reconciliation deadline. Tier II suspends the account for offenses such as repeatedly missing approval deadlines, letting someone else use your card, or making purchases without prior approval or documentation; reinstatement requires a corrective action plan and additional training, and continued problems mean cancellation for up to one year. Tier III covers deliberate personal use and other serious misconduct, with disciplinary action up to dismissal.1U.S. Coast Guard. DHS Purchase Card Manual DHS will seek restitution for inappropriate purchases, and an employee found to have made unauthorized transactions can be held personally liable for the full amount. Evidence of fraud or deliberate abuse is referred to the employee’s command and can lead to criminal investigation.