Year End Bookkeeping Checklist for Small Business Owners

The last quarter of the year sneaks up on everyone. Between holiday orders, slow paying customers, and your own time off, the books are usually the first thing that slides. Here's what to handle before December 31 so January is calm instead of a scramble.

1. Reconcile every account through the end of the year

Every bank account, credit card, loan, and payment processor should be reconciled against its statement. If your books say one thing and the bank says another, nothing else on this list can be trusted. If you haven't reconciled in months, start here and work forward one month at a time.

2. Clear out the "For Review" pile

Every transaction sitting in the QuickBooks Online bank feed needs a category. Uncategorized expenses are deductions you might miss, and uncategorized deposits make your income look wrong. Work through them now, while you still remember what that $212 charge in July was.

3. Look at who still owes you

Run an accounts receivable aging report. Invoices over 60 days old deserve a friendly reminder before the holidays, when people tend to settle up. Anything you've truly given up on should be written off so your income isn't overstated.

4. Enter every bill you've received

Bills that arrived but never made it into the books understate your expenses. Go through your inbox, vendor portals, and that stack of paper, and get every bill entered with its due date. This also tells you exactly how much cash you need to start the year.

5. Collect W-9s from contractors

If you paid any individual or unincorporated business for services this year, you may owe them a 1099 in January. You need a W-9 from each one to file it. Ask now, because contractors are much harder to reach in January. More on this in 1099 prep for small business owners.

6. Confirm payroll totals

If you run payroll, make sure every pay run is recorded, bonuses are in, and the payroll liability accounts match what was actually paid to the IRS and the state. W-2s go out in January, and they're built from these numbers.

7. Record big purchases properly

Bought a vehicle, equipment, or a computer this year? Those usually belong on the balance sheet as assets rather than straight to expenses. Flag them for your CPA, who decides how to depreciate or deduct them.

8. Separate anything personal

Groceries on the business card, or business supplies on a personal card, need to be sorted out before the year closes. A few owner draw or contribution entries clean this up. Mixed money is one of the biggest sources of tax time questions.

9. Read your profit and loss like a stranger would

Run the year to date profit and loss and look for anything odd. A category that doubled. A month with zero income. An expense that shows up twice. These are usually simple categorization mistakes, and they're much easier to fix in December than in April.

10. Package it for your CPA

In January, your CPA needs a profit and loss, a balance sheet, your reconciliation reports, a list of fixed asset purchases, payroll summaries, and copies of the 1099s you filed. When those arrive clean and on time, tax prep goes faster and usually costs less.

Let's close your year

I'm a certified QuickBooks Online ProAdvisor working with small businesses in Tennessee and across the US. Text, call, or email me and tell me where your books stand. Monthly bookkeeping starts at $300 a month, and year end cleanup is quoted after a quick look.