18 Things To Do Before the Tax Year Closes

As the year winds down, it's time to gear up for a crucial task – navigating those year-end tax considerations. Whether you're a seasoned business pro or just getting started, ensuring your financial ducks are in a row is a must. Here's a checklist of 18 things to tackle before the tax year closes:

1. Review Financial Records: Ensure all financial records, including income statements, balance sheets, and expense reports, are accurate and up-to-date.

2. Reconcile Accounts: Reconcile bank accounts and credit card statements to identify any discrepancies or errors that need to be addressed.

3. Organize Receipts and Invoices: Gather and organize all receipts, invoices, and financial documents. Proper record-keeping is essential for tax deductions and audits.

4. Inventory Management: Conduct a physical inventory count if applicable to your business to accurately calculate the cost of goods sold (COGS).

5. Depreciation Schedule: Review and update your depreciation schedule for fixed assets and equipment, as changes may affect your tax liability.

6. Review Deductions: Evaluate potential deductions such as home office expenses, business vehicle usage, and retirement plan contributions. Make any necessary adjustments.

7. Estimated Tax Payments: Calculate and make any remaining estimated tax payments for the current tax year to avoid penalties and interest.

8. Retirement Contributions: Maximize retirement plan contributions, such as a 401(k) or SEP IRA, to reduce taxable income.

9. Charitable Contributions: If your business made charitable donations during the year, ensure you have proper documentation and receipts for deductions.

10. Employee Records: Ensure all employee records, including W-2s and 1099s, are accurate and submitted to the IRS and employees by the required deadlines.

11. Health Insurance: If you provide health insurance for your employees, ensure compliance with reporting requirements and provide necessary forms.

12. Review Tax Strategies: Consult with a tax professional or accountant to review your overall tax strategy and identify potential opportunities for tax savings.

13. State and Local Taxes: Be aware of any state and local tax obligations and deadlines, as they may differ from federal requirements.

14. Tax Credits: Investigate any available tax credits that your business may qualify for, such as energy-efficient equipment or hiring credits.

15. Year-End Bonus Planning: If you plan to give year-end bonuses to employees, calculate the tax withholding accurately and provide necessary documentation.

16. Update Employee Information: Ensure that your records for employees, contractors, and vendors are current and accurate.

17. Record Keeping: Maintain all financial records and tax-related documents in a secure and easily accessible location.

18. Tax Planning for the Upcoming Year: Develop a tax plan for the upcoming year, considering changes in your business and tax laws.

Remember, proactive planning now can lead to significant savings later. Don't let the year end without securing every possible advantage for your business. Here's to a tax-savvy year ahead!

Your Beauty Brand Coach,
Heather Marianna