The air has a brisk chill, the scent of pumpkin spice floats through almost every food establishment, and Christmas music will be playing way too soon. It’s that time again. No, not the holidays, but time to get your books ready for year-end tasks and upcoming tax preparation season. Being ready for these year-end items before they get here saves you money and heartburn come deadline time.
Putting in some work now will be worth its weight in gold come January. Here’s a small sample of the items you should be considering:
- 1099’s – Issued to all non-corporate vendors who provided services in excess of $600 including non-employee compensation and rent
- Do you have a W-9 for all your vendors? If not, start contacting them now and gathering them.
- Does your financial system have the ability to produce 1099’s? If so, what needs to be done in the system to make it run properly? Start making sure information in your system such as vendor information and account mappings are properly done.
- Payroll and payroll taxes
- Do you have all your employees’ information updated including withholdings, current addresses, social security numbers, etc?
- Consider fringe benefits and if they’ve been included in employee compensation. Examples of fringe benefits are:
- Personal use of a company vehicle
- Group life insurance greater than $50,000
- Items for S Corp shareholders who own more than 2% of the company
- Business tax preparation
- Have you done a review of your financial statements, balance sheet and income statement? Is there anything that seems off based on what you know about your business?
- Have all items like fixed assets and owner draws been properly classified?
- Personal tax preparation
- Have you had any special transactions occur this year, such as sales of your home or rental property, purchase or sale of a business, or anything else that you won’t receive an IRS form for? If so, start gathering the applicable paperwork now.
This is just a small smattering of year-end items to consider. If you need help with any of these items, year-end in general, or any other questions, please reach out to us and allow us to help you be prepared. After all, an ounce of prevention is worth a pound of cure.
Have a great start to your year-end and holiday season!