The end of the year always seems to arrive faster than business owners expect.
One minute you’re busy with fall projects. Before you know it, December is here, and tax season is right around the corner.
Most business owners know they need to gather records and prepare for taxes. However, it’s easy to miss the smaller details that affect your bookkeeping and plans for the coming year.
By reviewing those items now, you can avoid last-minute surprises and start the new year feeling more organized and confident.
Take a Look at What’s Still Outstanding
Before the year ends, take a look at the money customers still owe your business.
Do you have unpaid invoices? Are there customer balances you need to follow up on? Have any outstanding payments been sitting too long?
Next, review your unpaid bills and upcoming expenses.
When you know how much money you expect to receive and what you still need to pay, you’ll have a clearer picture of where your business stands as you head into the new year.
Make Sure Payroll Information Is Correct
Payroll mistakes are much easier to fix before year-end forms are prepared.
Take a moment to review employee names, addresses, withholding information, and other payroll records. Make sure bonuses, reimbursements, and other compensation have been recorded correctly.
The same idea applies to independent contractors. Confirm that you have the information you need for people or businesses that may require year-end reporting.
A little cleanup in November or early December can prevent a lot of scrambling later.
Review Major Purchases and Equipment
Did your business purchase equipment, computers, vehicles, furniture, or other significant items this year?
Make sure those purchases are recorded correctly and bring them up with your accountant before year-end.
Timing can matter when it comes to certain purchases, deductions, and depreciation. That doesn’t mean you should buy something just for a tax reason, but it does mean your accountant should know what you’ve already purchased and what you may be considering before December 31.
Don’t Forget the Small Expenses
Small business expenses are easy to miss because they happen throughout the year.
Mileage, subscriptions, software, professional memberships, supplies, business meals, and other everyday costs may be sitting in email receipts, credit card statements, or someone’s glove compartment.
Now is a good time to gather them.
The goal isn’t to chase every penny at the last minute. It’s to make sure the records tell an accurate story of what it actually cost to run the business.
Look at Estimated Taxes and Retirement Contributions
Year-end is also a good time to check where you stand with estimated tax payments.
Were the payments you made during the year enough based on how the business actually performed? Has income changed significantly since the beginning of the year?
Business owners may also want to review retirement contributions and other planning opportunities that could have year-end deadlines.
These are areas where having the conversation before December ends can make a real difference.
Think About Next Year, Too
Year-end planning isn’t only about closing the books.
It’s also a chance to look at what changed this year and what may be different next year.
Are you hiring? Buying equipment? Adding a location? Changing ownership? Planning a major investment? Expecting income to increase or decrease?
Those decisions can affect tax planning and the way your business should prepare for the year ahead.
Don’t Wait Until Tax Season to Start Asking Questions
By the time tax documents start arriving in January, some planning opportunities may already be behind you.
That’s why November and December are valuable months for business owners to review the year, clean up the details, and ask questions while there is still time to act.
Ryder & Company can help you look at the bigger picture, from bookkeeping and payroll to tax planning and year-end preparation.
Not sure what should be handled before December 31? Start the conversation now and head into the new year with fewer loose ends.