Your Ultimate Year-End Bookkeeping Checklist for Tax Season

As tax season approaches, businesses must ensure their financial records are accurate and up to date. Proper bookkeeping helps avoid errors, minimize tax liability, and maintain compliance. Below is a comprehensive checklist to help small and medium-sized businesses prepare for tax filing. Adjust as needed based on your business’s specific circumstances or tax jurisdiction.

1. Reconcile Bank and Credit Card Accounts

• Match all transactions in your bookkeeping software with bank and credit card statements.

• Resolve discrepancies, such as missing transactions or duplicate entries.

2. Categorize Transactions

• Ensure all income and expenses are properly classified (e.g., revenue, utilities, payroll).

• Separate personal and business transactions if accounts are mixed.

3. Review Accounts Receivable

• Update records of outstanding invoices.

• Follow up on overdue payments or write off uncollectible debts.

4. Review Accounts Payable

• Confirm all bills are recorded and paid, or note outstanding liabilities.

• Verify vendor balances to ensure accuracy.

5. Record Depreciation and Amortization

• Calculate and log depreciation for fixed assets such as equipment and vehicles.

• Account for amortization of intangible assets like patents and loans.

6. Organize Receipts and Documentation

• Collect receipts, invoices, and proof of expenses, such as travel and meals.

• Digitize or file them for easy access during tax prep or audits.

7. Process Payroll Records

• Verify employee wages, tips, and bonuses are accurately recorded.

• Ensure payroll taxes (withholdings, employer contributions) are calculated and documented.

8. Review Inventory (If Applicable)

• Conduct a physical inventory count.

• Adjust records for cost of goods sold (COGS) and unsold stock.

9. Check Loan and Interest Payments

• Confirm loan balances and interest paid are up to date.

• Separate principal and interest for accurate financial reporting.

10. Prepare Financial Statements

• Generate a Profit & Loss Statement (income statement).

• Create a Balance Sheet showing assets, liabilities, and equity.

• Review the Cash Flow Statement for accuracy.

11. Identify Tax-Deductible Expenses

• Flag eligible deductions such as office supplies, mileage, and home office expenses.

• Double-check compliance with tax rules (e.g., meal expense limits).

12. Gather Tax Forms and Prior Returns

• Collect W-2s, 1099s, and other relevant tax forms issued or received.

• Review last year’s return for consistency or carryovers (e.g., losses).

13. Run a Trial Balance

• Ensure debits equal credits across all accounts.

• Fix any imbalances before finalizing records.

14. Consult With Your Accountant or Bookkeeper

• Share updated financial records for professional review.

• Confirm any specific tax elections, credits, or filing deadlines.

15. Back Up Your Data

• Save digital copies of bookkeeping files and supporting documents.

• Store physical records securely for future reference.

✅ Not sure what these items mean or how to complete them? Now is the time to consult with a professional bookkeeper! Cozort Bookkeeping Services can help you get tax-ready with ease. Schedule a FREE consultation today at www.cozortbkservices.com.