End of Year Checklist-Get Tax Ready!



December 16, 2020

The end of the year is upon us and tax time is coming quickly after. Are your books tax ready? Are you worried about what needs to be done at year-end to make sure your finances are in order? Don’t worry, because I’m going to walk you through 3 of my 7 steps of my year-end financial checklist, plus I’ve got a printable PDF of the whole checklist for you as well so you can go through these steps in your own time after you read this blog or watch my YouTube Video.

As December 31st inches closer and closer, there are a few things you should be doing to make sure your business finances are in order and ready for taxes. Let’s go ahead and walk through these first three steps together!

#1 Get Organized

You’re not going to be able to make it through the rest of the steps I talk about in my checklist if you aren’t somewhat organized. Now is the time to gather receipts and get them uploaded to a cloud drive. Make sure you have access to your accounting software, budget spreadsheet, or whatever you use. If you have a bookkeeper or CPA, touch base with them and answer any lingering questions, etc. If you’re behind on your bookkeeping, now is the time to get caught up!

#2 Button-Up Your Books

Whether you are using software like Quickbooks Online or using a spreadsheet to track income and expenses, now is the time to make sure everything is accurate and accounted for. This is when you want to make sure that you’ve reconciled your accounts for each month of the year. This process of reconciling will ensure that your software or spreadsheet has the same exact transactions that flowed in or out of your bank and credit card accounts all year long. Don’t be scared of the word reconcile, either! Reconciling is just a simple process of matching up bank and credit card statements to the transactions that will ultimately show on your P&L. You want to ensure that you aren’t accounting for too much or too little!

#3  Review Your Accounts Payable and Accounts Receivable

Do you owe anyone and does anyone owe you? If you have some outstanding invoices that you need to pay, now would be a great time to pay the ones that you can. If you can’t afford to pay all of them right now, create a plan to get them paid over the next couple of months. You don’t want overdue invoices hanging over your head for too long. At the same time, if anyone owes you money, now is a great time to remind them of that. The longer an invoice goes unpaid, the harder it is to collect on it. Most people may have simply forgotten about the invoice you sent them so a gentle reminder may be just what they need to go ahead and click that PAY button. Even if you don’t collect it all before year-end, you have at least opened up the conversation with those customers and they hopefully will put a plan in place to pay you soon. 

These are just 3 of the 7 steps in my end of year check-list! Want to know the other 4? I have a printable PDF that I’d love for you to have that way you can easily access it and start to go through these steps when time allows. Simply click here to download the PDF.

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