It’s not too early to begin thinking about year-end! Here are five practical steps small businesses should take to be prepared:
#1: Get Your 1099 Documents in Order. Make sure you have all the paperwork you need for issuing 1099s. This includes contracts, invoices and W-9 forms for any contractors and vendors you have worked with. Double-check that you have the correct taxpayer ID numbers (TINs) and addresses to avoid any last-minute headaches.
#2: Review Your Accounts Receivable. Take a close look at your accounts receivable to spot any invoices that are still outstanding. Reach out to customers for overdue payments and consider writing off any bad debts that you’re unlikely to collect. Cleaning up your receivables will boost your cash flow and give you a clearer picture of your business’s financial health.
#3: Keep Track of New Asset Purchases and Leases. Gather all the documents related to any new assets you have bought or leases you have signed this year. This means pulling together invoices, purchase agreements, and lease contracts. Having everything organized will make it easier for your accounting team to ensure your books are in order.
#4: Check Over Your Payroll Records. Go through your payroll records to ensure everything is accurate, including any bonuses, commissions, or employee benefits. Make sure all the employee details, like Social Security numbers and addresses, are up to date. This will help when it’s time to issue W-2s and handle payroll taxes.
#5: Talk to Your Accountant About Ownership or Management Changes. If there have been any shifts in ownership, management, or your business structure this year, it’s important to loop in your accountant. These changes can have big tax implications, and your accountant can help you navigate the best steps to stay compliant and make the most of your situation.
Bob Wallish, CPA