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Year-End Accounting Resource Center

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Year-End Accounting Resource Center

This page contains a multitude of year end accounting resources we have gathered from the web and produced internally for our clients. Use the navigation links below to scroll through the page to find the resources you need. If you would like a personalized consultation from one of our small business / QuickBooks accounting experts, please feel free to call (888) 232-4758 anytime, or request a year end review to get started.

What’s here?

UPDATE: The Treasury recently announced tax changes and updates in response to COVID-19. Updates include an extension until July 15, 2020 for all taxpayers that have a filing or payment deadline that normally falls on or after April 1, 2020 and before July 1, 2020. Please see the latest information on tax deadlines and stimulus updates related to COVID-19 on the TurboTax Coronavirus Tax Center and detailed information about federal and state tax changes on Intuit’s Coronavirus blog post.


Book your year end review with one of our small business accounting experts

Our year-end reviews typically cover, but are not limited to:
  • General Ledger Review
  • Budget Analysis & Planning
  • Tax Prep & Plan for 1099s & W2s
  • Review Insurance Policies, Leases & Loan Documents


Schedule a Review




Section 1: Year End Checklists

Below you will find a compilation of daily, weekly, monthly, quarterly, and annual small business accounting checklists, as well as tips/tricks to help get you to start the new year with a strong financial foundation.



1. Check Cash Position

Since cash is the fuel for your business, you never want to be running near empty. Start your day by checking how much cash you have on hand. Knowing how much you expect to receive and how much you expect to pay during the upcoming week/month is important, too—but it is not gas in your tank.

Managing your business finances does not have to be eat-your-spinach drudgery. The key, of course, is to create a realistic plan with a budget, record your transactions correctly, review your results regularly and always keep good records. Your comfort level with the three basic financial reports that evaluate your fiscal health is also essential: the balance sheetincome statement and cash flow statement.

2. Refresh your financial data.

Ideally, your accounting software automatically does this for you each day, syncing your bank and credit card feeds and the sales data from your POS system into your accounting software. If it doesn’t, you’ll need to do this manually. This gives you an up-to-date look at your accounts, showing you the money moving in and out of your business.

3. Back-Up Your Data

If you’re not using cloud-based accounting software like QuickBooks that automatically backs up your data, back up your financial data manually every day. Doing so gives you peace of mind that you won’t lose your data if you have a hardware failure, file corruption or some other issue.



1. Record Transactions

Record each transaction (billing customers, receiving cash from customers, paying vendors, etc.) in the proper account daily or weekly, depending on volume. Although recording transactions manually or in Excel sheets is acceptable, it is probably easier to use accounting software like QuickBooks. The benefits and control far outweigh the cost.

2. Document & File Receipts

Keep copies of all invoices sent,  all cash receipts (cash, check and credit card deposits) and all cash payments (cash, check, credit card statements, etc.).

Start a vendors file, sorted alphabetically, (Staples under “S”, Costco under “C,”etc.) for easy access. Create a payroll file sorted by payroll date and a bank statement file sorted by month. A common habit is to toss all paper receipts into a box and try to decipher them at tax time, but unless you have a small volume of transactions, it’s better to have separate files for assorted receipts kept organized as they come in. Many accounting software systems let you scan paper receipts and avoid physical files altogether.

3. Review Unpaid Bills From Vendors

Every business should have an “unpaid vendors” folder. Keep a record of each of your vendors that includes billing dates, amounts due and payment due date. If vendors offer discounts for early payment, you may want to take advantage of that if you have the cash available.

4. Pay Vendors, Sign Checks

Track your accounts payable and have funds earmarked to pay your suppliers on time to avoid any late fees and maintain favorable relationships with them. If you are able to extend payment dates to net 60 or net 90, all the better. Whether you make payments online or drop a check in the mail, keep copies of invoices sent and received using our accounting software.

5. Prepare & Send Invoices

Be sure to include payment terms. Most invoices are due within 30 days, noted as “Net 30” at the bottom of your invoice. Without a due date, you will have more trouble forecasting revenue for the month. To make sure you get paid on time, always use an invoice template the contains the right details such as payment terms, itemized charges, and your payment address.

Read more about the anatomy of an invoice and how to get paid on time.

6. Review Projected Cash Flow

Managing your cash flow is critical, especially in the first year of your business. Forecasting how much cash you will need in the coming weeks/months will help you reserve enough money to pay bills, including your employees and suppliers. Plus, you can make more informed business decisions about how to spend it.

All you need is a simple statement showing your current cash position, expected cash receipts during the next week/month and expected cash payments during the next week/month. To download a free customizable cash flow statement template, click here.



1. Balance Your Checkbook

Just as you reconcile your personal checking account, you need to know that your cash business transaction entries are accurate each month and that you are working with the correct cash position. Reconciling your cash makes it easier to discover and correct any errors or omissions—either by you or by the bank—in time to correct them.

2. Review Past-Due (“Aged”) Receivables

Be sure to include an “aging” column to separate “open invoices” with the number of days a bill is  past due . This gives you a quick view of outstanding customer payments. The beginning of the month is a good time to send out overdue reminder statements to customers, clients, and anyone else who owes you money.

At the end of your fiscal year, you will be looking at this account again to determine what receivables you will need to send to collections or write off for a deduction.

3. Analyze Your Inventory Status (If Applicable)

If you have inventory, set aside time to reorder products that sell quickly and identify others that are moving slowly and may have to be marked down or, ultimately, written off. By checking regularly (and comparing to prior months’ numbers), it’s easier to make adjustments so you are neither short nor overloaded.

4. Process or Review Payroll & Approve Tax Payments

While you have an established schedule to pay your employees (usually semi-monthly), you need to meet payroll tax requirements based on federal, state and local laws at different times, so be sure to withhold, report and deposit the applicable income tax, social security, Medicare and disability taxes to the appropriate agencies on the required dates. If you need help with payroll, we can help.

Review the payroll summary before payments are disbursed to avoid having to make corrections during the next payroll period. A payroll service provider can do all this to save you time and ensure accuracy at a reasonable cost. You can also use our free paycheck calculator to figure out what you need to withhold from each paycheck.

5. Review Actual Profit & Loss VS. Budget & VS. Prior Years

Your profit and loss statement (also known as an income statement), both for the current month and year to date, tells you how much you earned and how much you spent. Measure it against your budget every month (or quarter). Comparing your actual numbers to your planned numbers highlights where you may be spending too much or not enough, so that you can make changes.

If you have not prepared a budget, compare your current year-to-date P&L with the same prior-period year-to-date P&L to identify variances and make adjustments.

Check out Intuit’s guides to download a free customizable budget template and profit and loss statement.

6. Review Month-End Balance Sheet VS. Prior Month

By comparing your balance sheet at one date—June 30, 2015, for example—to a balance sheet from an earlier date (December 31, 2014), you get a picture of how you are managing assets and liabilities. The key is to look for what is significantly up and/or down and understand why. For example, if your accounts receivable are up, is it due to increased recent sales or because of slower payments from customers?

Click here for a free customizable balance sheet template. Learn more about reporting in QuickBooks



1. Prepare/Review Revised Annual P&L Estimate

It’s time to evaluate how much money you are actually making, whether your net assets are going up or down, the difference between revenues and expenses, what caused those changes, how you are spending profits, as well as identifying trouble spots, and making adjustments to improve sales and margins.

2. Review Quarterly Payroll Reports & Make Payments

You have been reviewing your semi-monthly payroll reports. However, the IRS and most states require quarterly payroll reports and any remaining quarterly payments. Again, it’s best if your payroll service provider completes these reports and files them. Your job is to review to make sure they appear reasonable.

3. Review Sales Tax & Make Quarterly Payments

If your company operates in a state that requires sales tax, make sure you comply to avoid serious penalties. The U.S. Small Business Administration (SBA) and sales tax software like Avalara can help you determine your state tax obligations.

4. Computer Estimated Income Tax & Make Payment

The IRS and states that have income taxes require you to pay estimated income taxes. Review your year-to-date P&L to see if you owe any estimated taxes for that quarter. Your tax accountant can assist if necessary.



1. Review Past Due Receivables

Now it’s time to check significant past due receivables and decide whether you think customers will eventually pay, whether to send past due bills to a collection agency or whether to write them off for a deduction.

2. Review Your Inventory (If Applicable)

Review your current inventory to determine the value of items not sold. Any write-down of inventory translates to a deduction on your year-end taxes. If you do not write down unsellable inventory, you are overstating your inventory balance and paying additional taxes that you don’t owe.

3. Fill Out IRS Forms W-2 & 1099-MISC

The IRS has a January 31 deadline that requires you to report the annual earnings of your full-time employees (W-2s) and most independent contractors (1099s). This deadline includes mailing copies of the tax forms to the people who worked for you. Note: A 1099 form is not required for any contractors who earned less than $600. Consider saving time and avoiding errors with an e-filing service.

For help determining whether your worker is an independent contractor or an employee, see our W-2 vs. 1099 Wizard. If you employ independent contractors, check out our guide to filing 1099s.

4. Review & Approve Full-Year Financial Reports & Tax Returns

At tax time, carefully review your company’s full-year financial reports before giving them to your accountant. Before you sign your return, be sure to review it for accuracy based on your full-year financial reports. If the IRS audits your company and finds any underpayment of taxes, it will come to you, not your accountant, for any additional taxes, penalty  and interest.

Accounting software like QuickBooks can help you generate financial reports and manage taxes, but for more guidance, see our guide to financial reporting. To keep a handy reference of this checklist, download the TurboTax Tax Prep Checklist PDF



Section 2: Dealing with the IRS

The Internal Revenue Service: a name that strikes fear into the hearts of taxpayers and business owners everywhere. If you’ve had to deal with them recently, chances are it wasn’t a very good experience. But fear not, below are a few suggestions that may ease your pain the next time the IRS comes calling.





1. Don’t Avoid The Problem

I’ve had several bookkeeping clients who were putting all IRS correspondence aside in its own pile, sometimes waiting months before they worked up the nerve to open and read any of it.

But the longer you wait, the harder it will become. It is always better to deal with this kind of problem head-on, with honesty and transparency. Schedule time to review any correspondence, study the issue, and prepare as best you can.

2. Get Organized Before You Call

Have all your information handy and sorted appropriately, including:

  • Identification information for you and/or your business: They may ask you anything as part of the verification process, including your business address on file, the date you organized your business, your tax ID, information about business partners, entity type or information from past tax returns.
  • All correspondence you have received from the IRS: Open all of it, and review carefully before you call in. This way, you understand the issues beforehand and aren’t surprised when on the call.
  • Any supporting documents you can gather regarding the issues at hand, especially tax returns.
  • Notes from any previous calls you may have made to the IRS.
  • A comprehensive list of every single little question you can think of: This is really important, because it can be easy to forget issues while you are on the call.

3. Give Yourself Time (2-3 Hours)

The best time to call is 7 a.m. local time, right when the IRS opens for business. This is probably when wait times will be the shortest, but you may still end up being on hold for a while, as the estimated wait time for the 2020 tax season is more than 30 minutes per call.

Have a good book handy, and make sure your phone is charged!

4. While On The Call, Be Nice!

The IRS has had its budget cut by Congress several times over the past few years, which means it has smaller and fewer resources to handle its ever-increasing demand. As such, their call-center employees are likely overworked and underpaid. Put yourself in their shoes: How would you handle receiving calls all day from people who are angry, bitter or panicked about their tax problems? Remember that they have a thankless job, so be nice.

Aside from being common courtesy, having a kind and polite attitude is probably the most effective way to get help with everything you need. Bite your tongue, if necessary, and express some gratitude for their time and efforts to help you. As we all know, a little kindness can go a long way.

5. Take Notes & Make Sure You Understand Everything

Write down everything, starting with the date, the name of the agent who’s helping you, and his or her ID number.

Go through that list of questions you prepared, and make sure you understand every answer they offer. Don’t just assume that what they are talking about is over your head—it is worth your time to make sure you understand what they are trying to explain to you.

Get as much detailed information as possible: Don’t just ask, “Do I still owe money?” Instead, ask, “Can you confirm that I don’t owe any money for any time period on any tax form?”

Before you get off the call, review the main points of your conversation with the agent, and repeat back what your obligations are. This helps ensure there are no misunderstandings and prevents you from having to call back at a later time. Also, make note of any promises the phone agent has made, so you have a record if something does not go as planned.

While these suggestions are not a guarantee that your conversation will go the way you’d like, they should help things go more smoothly. These tips will hopefully make your tax season worry-free and your time on hold as short as possible.


Section 3: Estate Planning

By creating a detailed estate plan for your family business now, you can rest assured knowing the company will transition smoothly when you’re no longer around. Here’s a brief list of what your plan should account for.




Most of us will use wills to distribute our assets and protect loved ones when we’re no longer around. Many business owners, however, don’t have the same mechanisms in place to ensure their firms stay in the family. Proper estate planning can help mitigate any risks following a business owner’s passing by determining how money and assets will be divided upon death. Not only does estate planning help ensure that the right people inherit your business, but it also enables you to minimize taxes during the transition while avoiding legal snafus.

Many business owners make the mistake of assuming that they can pass a family company down to their children without issue. The truth is that failing to create an estate plan may subject your estate to a federal gift tax. Coupled with the expense of funeral planning, this tax can put a serious burden on those family members left behind. Additionally, failing to communicate your intentions to family members and other business partners can leave your company floundering.

Ownership Transfer Issues

After a family business owner passes on, those left behind are often left scrambling to make decisions about daily operations. A good business estate plan doesn’t just address ownership transfer, but can also help coordinate the day-to-day management and operations of the company after the owner’s death.

For best results, ensure your estate plan includes details on dealing with directors, consultants and shareholders outside the family, as well as a plan that addresses the business’ key employees. Additionally, it’s important to specify who will be running the business if this person is different from the individual who ends up owning it. Taking the above steps before a death will help protect the legacy of the business for years to come.

If you’re the sole owner of your family business, you can create an estate plan that details the transfer of ownership and managerial power to your next of kin. The situation becomes more complicated for family businesses with multiple owners. In these cases, consulting the shareholder or partnership agreement is crucial. Not only does this document dictate who can and cannot acquire shares after a current owner passes on, but it may also prevent spouses and children from becoming owners by requiring surviving shareholders to buy out the deceased member’s portion of the business.

Tax Considerations

If you’re like most family business owners, then the odds are good that a majority of your wealth is tied up in the company you operate. Hence, it’s important to take steps to protect your loved ones from unnecessary tax payments when you’re gone. Without an estate plan, your business’ new owner may be on the hook for an estate tax (sometimes called the “death tax”) ranging from 35 to 50% of the company’s value. Because few family businesses possess this much liquid cash, new owners have to choose between selling the company and taking out large loans to cover the IRS bill.

One of the benefits of estate planning is that it lets family businesses plan for the future and take advantage of applicable IRS tax breaks. Under Section 303, the estate can redeem stock at a lesser tax cost. On the other hand, Section 6166 allows executors to pay estate taxes in installments as opposed to a single hefty sum.

Additionally, a business owner may want to gift stock to family members during his or her lifetime. While doing this prevents the owner from having to pay income tax on the gift, family members may be on the hook should they decide to sell the stocks at a later date. Business owners may want to consider a stock’s short- and long-term tax situation before gifting it to younger family members.

Key Documents for Estate Planning

Detailed legal documents are crucial for protecting your family business after a death. While you may assume that a will would be sufficient to protect your business interests, a living trust may afford you stronger protections. Whereas a will is a document that coordinates the division of your property after your death, a living trust effectively owns your ownership share in the business and allows you to continue to make all decisions. Assets included in a living trust—like your business—will not be subject to normal probate-related proceedings after death.

Additionally, a living trust assists family businesses in transferring ownership. After transferring the company to the trust, the owner can specify a successor who will take over the trust at a designated time, usually upon the owner’s death. Forming a living trust can also reduce estate taxes that would apply during the probate process.

While a living trust is ideal for single-owner businesses, companies with multiple owners (e.g. partnerships, multiple-member LLCs, corporations) may require a buy-sell agreement to protect their assets. Also known as buyout agreements, these documents prevent beneficiaries from being burdened with businesses they don’t want while protecting partners in the event of one owner’s death. By using a conservative valuation formula when creating the buy-sell agreement, owners can lawfully establish the value of the ownership interest at a price beneath the sales value upon death.

An estate plan doesn’t just protect your family—it also safeguards the legacy of the business you worked hard to build. Luckily, business owners can arrange for the transfer of a company during their lifetimes, thereby minimizing the chance of a discounted sale. By putting your estate plan into place now, while you’re still around, you can avoid undue tax burdens and enjoy your golden years knowing your family business is in good hands.


Section 4: W-2 VS. W-4

Whether you’re a business owner or an employee, tax forms are an inescapable part of your job. Between the numerous consonants and hyphens, it’s easy to get lost in the IRS’ alphabet soup.



Two related documents, Forms W-4 and W-2, are subject to confusion because their names are so similar. They are both related to an employee’s tax situation but serve different functions.

Since it’s relatively easy to mix the two up, we’re going to take a look at how they differ, what purposes they serve, and when both employers and employees should think about them.

About the W-4

The W-4 is a tax form used to calculate the correct amount of federal income tax that should be withheld from an employee’s pay. An employee must consider factors like his or her family situation (i.e. number of children, marital status, etc.), homeownership (i.e. buying or selling a house), saving contributions (i.e. college, retirement, etc.), number of dependents and even employment status. This form is required for all employees except those that earn less than $800 per year.

This form must be completed whenever an employee starts a new job. An employee can also update his or her W-4 at any time based on changes in his or her personal or financial situation. As an employer, you are under no obligation to request updates. If a new hire is unsure about how much pay to withhold, he or she can use the IRS’ Online Withholding Calculator for assistance.

About the W-2

The W-2 is a tax form that employers give to their employees at the end of each year. This form includes the total amounts of wages earned, federal and state taxes withheld and contributions to Social Security for a given tax year. After receiving it from his or her employer, the employee must submit this information when paying taxes in April with their Form 1040.

Employers are required to provide their employees with this information by January 31 of each year and submit a copy to the Social Security Administration (SSA) by February 29. A copy must also be kept on record for a minimum of four years. An additional three copies are furnished to employees for their personal records and tax filings.

The SSA has made recent efforts to increase efficiency and decrease waste by allowing for electronic filing. If you chose to file this way, the deadline for 2015 is extended to March 31. Employers can use the Business Services Online suite of the Social Security Administration site for more information on electronic W-2 submissions.

A more in-depth guide to filing W-2s can be found at the IRS website.


Section 5: How to prepare

Getting your financial house in order now can help you avoid problems later. Here are some tax prep tips and key documents to gather as the calendar year draws to a close.





Income Records 

If you worked for an employer before becoming an entrepreneur, you know that reporting your income as a small-business owner is trickier than it was when you simply waited for a W-2 to arrive in the mail. Minimize your tax-season headaches by organizing your bank deposits and statements, receipt books, invoices, and credit card processing data from the past year, along with any 1099-MISC forms you receive from clients.

W-9s and Employee Withholdings

Did you hire any independent contractors or work with subcontractors whom you paid more than $600 in 2019? If so, confirm that you have a completed and signed Form W-9 on file for each one; you’ll need to send them a 1099-MISC by Jan 31, 2020. Did you have employees on your payroll? Pull together your records of all local, state and/or federal taxes and Social Security you paid on their behalf (and withheld from their paychecks). “You should have these records on file if you do your own payroll. If you use a payroll service, they will have copies of them,” says Manny Skevofilax of Portal CFO Consulting.

Receipts for General Business Expenses

If you plan to deduct, or “write off,” expenses related to your business, you’ll need evidence to support each claim. Round up your mileage log and/or original transaction receipts for advertising and marketing and business travel, meals, entertainment, gifts, and the like. Skevofilax urges small-business owners to begin this time-consuming information-gathering process well before tax time — especially if you don’t use an automated accounting system to track your business expenses.

Receipts for Home-Office Expenses

If you’ll claim a home-office deduction, gather receipts and canceled checks that support direct and indirect expenses, from utility bills to property insurance. If you have insufficient documentation to support a home office claim, new home-office rules allow you to claim $5 per square foot of the space used for business — up to 300 square feet — in 2018.

Asset Documentation 

If you entered into any kind of equipment or property lease in 2016 — whether for an office copy machine or a business vehicle — make sure you have the paperwork on hand for tax prep. To support any claims of depreciation for assets you own, you’ll also need a purchase record (invoices, real estate closing statements, canceled checks) that includes when, how, and for what amount and purpose an item was purchased. If you no longer possess assets you previously claimed, note either how much you sold them for or how you disposed of them.

Annual Report Filing (If Required)

If you run a limited liability corporation, you may be required to file an annual report of sorts. It’s not an IRS report, so requirements vary by state (business owners in Delaware, Ohio, and South Carolina are exempt), and you’ll want to double-check the Statement of Information filing laws in your area. The process may simply require that you complete a one-page form verifying owner contact information and place of business; however, failing to miss the filing due date, which also varies by state, may result in penalties and fees. In some states (like California) not filing this information is taken as seriously as failing to file taxes at all, and can result in revocation of your legal right to conduct business in the state.

Estimated-Tax Payments

At this point, most small-business owners will have made three quarterly estimated tax payments for 2019. After you gather all of your income- and expense-related documents, verify that you’ve paid enough estimated taxes for 2018. If you haven’t, increase the payment that’s due Jan. 15, 2020, advises Nellie Akalp, CEO of the small-business advisory firm, in order to reduce the amount you owe on April 15, as well as any penalties for underpayment.


Section 6: Year-End Strategic Planning

Want to Get the Most Out of Your QuickBooks and Grow Your Business in 2023?



Define Your Growth Goals

Defining your growth goals is an important first step in the growth planning process. Without predefined goals, how will you determine where you are in your growth strategy? Better yet, how will you determine which parts of your plans are working and which are not? Goals not only shape the target that you’re aiming for but help you calculate how and where to make adjustments. However, goals will not lend you any assistance without being drafted correctly. Enter S.M.A.R.T. goals!

Make your Goals S.M.A.R.T.

S.M.A.R.T. goals are goals that follow a proven, strategic outline for reaching any objective(s). The acronym, S.M.A.R.T., stands for Specific, Measurable, Achievable, Realistic and Time Frame. Each word in the S.M.A.R.T. acronym represents a characteristic that each goal should account for. The description of each characteristic is listed below:

      • Specific: Be precise and exact with what you want to achieve and leave ambiguity and vagueness at the door
      • Measurable: Ensure there is a way to measure your progress and performance towards accomplishing your goal
      • Achievable: Being realistic is key; a good goal sets the bar high, but also within reach, as opposed to something unattainable
      • Relevant: Ensure your goal makes sense based on where you are/want to be heading
      • Time Frame: Set a date for goal achievement and define what needs to be done to get there

By making your goals S.M.A.R.T., you are creating structure and providing clarity around objectives you want your teams and organization to complete. When you are creating your growth goals, think of where you want to be, realistically, at the end of 2022. Consider where you want to be beyond 2022 as well. What about 2, 3, 4, and 5 years down the road?

Get Your Data Right!

Getting your QuickBooks company file’s (or multiple company files’) data right is more than just accuracy, however, accuracy IS critical. If your QuickBooks data is inaccurate, your reports and metrics will be too, obviously. And if your reporting and metrics are inaccurate, how can you construct a strong and dependable foundation on which to build out your goals? That solid and reliable foundation is critical to goal setting and developing effective growth strategies. And, importantly, when it comes time to measure your success, how will you accurately know when/if you have achieved it?

In addition to accuracy, having the most efficient and effective processes and workflows in place will support your growth tremendously. Your processes and workflows are an integral component of your foundation. Embarking on your mission to achieve growth goals with a weak foundation is setting yourself up for failure. So, how can you set yourself up for success? Have optimal processes and workflows in place!

The Brass Tacks

Here is how having optimal processes and workflows in place will support your growth goals and strategy:

More precise goal-setting: Set goals that support success right from the start! Know exactly where you are, where you want to be, how to get there, and accurately measure success.

Better strategical growth insights: Don’t miss out on growth opportunities! Knowing exactly where you are, in-depth, may shed light on growth opportunities you hadn’t seen.

Shed more light on resource requirements: Don’t miss out on resource requirements, either! Having the right resources, in the right places, at the right time, is what you need to support your growth. Oftentimes, the challenge is knowing what resources you’ll need. You can combat this with optimal visibility over your business.

Here are some other benefits that you will gain from having optimal processes and workflows in place:

Time & Money Savings: optimal processes and workflows equate to more productivity, and everyone can do that math!

How is this done? The elimination of double data entry, streamlined approvals, faster invoice creation, reductions in human error, and increased data accuracy – to name a few.

Increased Output Quality: Automized (fully or partial) and/or standardized repetition of processes and workflows equate to more consistent output quality.

Increased Visibility: Transparency in productivity allows for, and enables, better workflow management.

So, this begs the question; how do you know if your processes and workflows are optimized based on your business needs? And, do you want to improve your processes and workflows but don’t know how to design and implement them? Well, that’s where we come in! Get your QuickBooks Health Check!


Section 7: Tax prep tips

Are you behind on your bookkeeping? It’s more common than you might think. Knowing you are missing essential information for your taxes makes the process of catching up even more stressful.



If you are getting ready for taxes, here are some additional items for your bookkeeping checklist.

1. File For An Extension

When your books are a mess, you might need a little breathing room. You can file for an extension, giving yourself an extra six months to file. You don’t need to wait until tax day to file, either. You can file for an extension today if you want.

Don’t think, however, that a tax extension lets you off the hook for paying taxes on time. You are still required to make a tax payment by Tax Day. Estimate what you owe, make your payment, and then start working on your tax return.

You need to file because “failure to file” comes with its own penalty. If you know you won’t make the deadline, and you’re too rushed to get it done right, file for the extension and pay what you believe you owe. It’s possible to file your return anyway and then amend it later, but in most cases, it’s better to take a step back and make sure you file right the first time.

As long as you pay your tax bill, filing later allows you to be more thorough. It’s certainly better than accruing interest and penalties.

2. Gather & Organize Your Financial Records

From payroll to expenses, gather your financial records and organize them. All of the records should be organized by category:

  • Payroll
  • Independent contractors
  • Equipment expenses
  • Business travel
  • Utilities
  • Office supplies
  • Marketing costs
  • Charitable donations and tax-deductible sponsorships
  • Income from all sources (break into sub-categories if necessary)

If you have other categories unique to your small business, make sure they are included. You can use a spreadsheet for the organization. The important thing is to make it easy to identify expenses and categorize them. Don’t forget to go through your personal credit-card statements, just in case there is a business expense lurking. You will need to properly identify it on the receipt and be able to show that it was a true business expense.

It might take time to track down some of your records, which is why filing for an extension makes sense.

3. Review Your Expenses & Look For Credits & Deductions

Once you organize your receipts and other financial information, review them so that you can identify credits and deductions you might be missing. Accounting software can help you maintain your books, stay organized, and keep you prepared for tax season, or you can consult with a tax professional for insight on what you might be eligible for.

If you use tax-prep software to analyze your expenses, make sure you use an updated version. The tax code changes every year, so you might miss something if you use an older version.

Filing for an extension allows you to identify more tax breaks and then file your complete return without the need to amend your return, which can be a tedious process.

4. Prepare Better Bookkeeping For The Future

Finally, once you have caught up on your bookkeeping for last year, put systems in place that allow you to keep better books in the future. Most importantly, set up a filing system for your receipts. This can be a hard-copy system or a system for scanning and organizing digital copies. Immediately filing your information and sorting as you go saves time and energy in the long run.

If you don’t have accounting software, consider purchasing and using it. Programs like QuickBooks can help you keep track of all your financial information. You can use it for payroll, invoicing, and expense tracking. It’s also possible to use QuickBooks to manage and pay bills related to your small business. Accounting software, combined with a system for organizing receipts, can help reduce your headaches and prevent another last-minute scramble during tax time.


Section 8: Important Dates

The federal tax filing deadline has been extended to July 15, 2020. Taxpayers getting a refund are encouraged to file their taxes now to get their money.




Last tax season, close to 72% of taxpayers received a tax refund close to $3,000, which for many taxpayers is their largest paycheck of the year. During times like this, that is much needed money for many households. The IRS expects to continue to process refunds as normal. The IRS typically issues nine out of 10 tax refunds within 21 days or less from acceptance with e-file and direct deposit – the fastest way to get your refund.

January 17, 2023 4th Quarter 2022 Estimated Tax Payment Due If you are self-employed or have other fourth-quarter income that requires you to pay quarterly estimated taxes, get them postmarked by January 17, 2023 tax deadline.
April 18, 2023 Individual Tax Returns Due for Tax Year 2022 The due date for filing tax returns and making tax payments is April 18. If you haven’t applied for an extension, e-file or postmark your individual tax returns by midnight.
Individual Tax Return Extension Form Due for Tax Year 2022 
April 18, 2023 1st Quarter 2023 Estimated Tax Payment Due You’ll get a three month extension to make your first 2023 estimated tax payment. If you are self-employed or have other first-quarter income that requires you to pay quarterly estimated taxes, get your Form 1040-ES postmarked by this date.
April 15, 2023 Last Day to make a 2022 IRA Contribution Your 2022 IRA contribution isn’t due for an additional three months in 2023. If you haven’t already funded your retirement account for 2022, do so by April 15, 2023. That’s the deadline for a contribution to a traditional IRA, deductible or not, and a Roth IRA.  
June 15, 2023 2nd Quarter 2023 Estimated Tax Payment Due In 2023, your 2nd quarter 2023 estimated tax payment is due at the same time as your 1st quarter payment due to the extension of the payment deadlines. If you are self-employed or have other second-quarter income that requires you to pay quarterly estimated taxes, make sure your payment is postmarked by this date.
September 15, 2023  3rd Quarter 2023 Estimated Tax Payment Due If you are self-employed or have other third-quarter income that requires you to pay quarterly estimated taxes, make sure your third quarter payment is postmarked by Sept. 15, 2023 tax deadline.
October 16, 2023 Extended Individual Tax Returns Due If you got a filing extension on your 2022 tax return, you need to get it completed and postmarked by October 16, 2023.
January 15, 2024 4th Quarter 2023 Estimated Tax Payment Due If you are self-employed or have other fourth-quarter income that requires you to pay quarterly estimated taxes, get them postmarked by January 15, 2024 tax deadline.



Section 9: Tax Deductions

While there might be a few reasons to envy the self-employed lifestyle, the increased tax preparation burden isn’t one of them. Not only must some freelancers file quarterly tax payments or risk IRS penalties and fees, but they are also required to pay the portion of Medicare and Social Security typically covered by an employer.



10 Tax Deductions Every Freelancer Needs to Know


In light of this greater financial burden, self-employed people need to take advantage of all possible tax deductions to stay profitable.

While tax rules for freelancers can be complex, self-employed persons can generally write off expenses that fall into three categories:

  • Things you use exclusively in operating your business
  • Things you eat in the course of doing business
  • Things related to the exclusive business use of the place where your business operates

Here are 10 possible tax deductions that every freelancer should know about.

1. Travel and Hotel

If you travel to visit clients or attend trade shows, you may be able to deduct these expenses. Business travel expenses can include transportation and accommodation costs, and the IRS allows a 50% deduction for business meal expenses. It’s important to note that you shouldn’t attempt to write off any expenses associated with sightseeing and leisure travel, which can trigger an audit.

2. Home Office

Many freelancers work out of their homes in the early days, especially when their businesses are first getting off the ground. As a result, the IRS allows self-employed persons to deduct the portion of their mortgage or rent going to a home office.

To qualify for this write-off, you must have a specific area in your home designated for working, and you must refrain from using it for other purposes. When claiming this deduction, you can calculate the deduction’s value using either the regular or simplified home office deduction option.

3. Utilities

While business owners with offices outside their homes can deduct 100% of their utilities, freelancers who work inside the home can still write off a portion of this cost. To determine how much of your utility costs are tax-deductible, calculate the percentage of your home occupied by the office.

Along with gas and electricity, freelancers can deduct the costs of heating, air conditioning, and phone service. Be aware, however, that you cannot deduct the cost of utilities if you claim the simplified home office deduction.

4. Professional Development

As a freelancer, it’s important that you find ways to stand out from your competitors in the industry. To keep ahead of the pack, many freelancers attend classes and educational seminars.

Understanding that the cost of these expenses can add up, the IRS allows freelancers to deduct expenses related to professional development on their tax returns. Additionally, self-employed persons can write off dues for professional organizations and membership fees.

5. Advertising and Marketing

In our increasingly connected society, self-employed persons have to engage in marketing and advertising if they hope to stay competitive. The IRS permits freelancers to write off the cost of flyers, web advertising, business cards, and print ads among other marketing expenses.

6. Website

With a majority of consumers using the internet to research purchases, creating a mobile-friendly, responsive website is crucial for a freelancer’s success. Luckily, self-employed persons can deduct costs related to their business websites, including domain fees, design, building costs, and maintenance.

7. Software

These days, most freelancers spend their days staring at computer screens. From sophisticated video editing programs to basic options like Microsoft Office and Adobe Acrobat, software can be expensive and hence makes a useful deduction for small business owners and freelancers.

8. Mileage and Gas

Do you regularly drive to meet clients or suppliers? If so, you should take advantage of the tax deductions available for costs related to vehicle mileage or normal vehicle wear and tear. You can choose between two types vehicle-related deductions: the standard mileage option or the actual expense option.

The standard mileage option allows you to make a deduction based on how many miles you’ve used for business purposes. The actual expense option allows you to figure out the cost of maintaining your car with respect to the actual cost of keeping it maintained for business use.

9. Unpaid Invoices

It’s no secret that clients are sometimes late in paying their invoices, but some never pay at all. Fortunately, the IRS allows self-employed persons to deduct unpaid invoices as a loss for their businesses. Keeping a detailed list of unpaid invoices along with each invoice number will help you properly take the deduction.

10. Incorporation

If your freelance business is successful, you may be thinking about incorporating in the near future. The IRS permits new businesses to deduct expenditures associated with incorporation including state fees and legal costs during the business’ first year of operation.

Filing taxes as a freelancer for the first time can be stressful. That stress can include not knowing what to do with your self-employed tax forms. However, by taking advantage of all possible deductions and understanding what’s expected of you, you can minimize your tax burden and give your business the chance it needs to grow. On top of that, software like QuickBooks Self-Employed can help calculate expenses for you and simplify the entire tax-filing process.

For more tax-time tips, check out Intuit’s complete guide to taxes for the self-employed.


Final Thoughts


If we can help you with your bookkeeping needs, just contact us, we would love to help you!  We work remotely so we can work with any company located in the U.S. If we can help you with this process or provide you with custom reporting, please give us a call. If we cannot help you, we will refer you to someone who can!


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