As you prepare to close your books for the end of the year, here are a few tips to guide you to a smooth landing on December 31st.
1. Gather all of your bank, loan, and credit card statements in one place.
Whether this is a designated folder on your computer or a physical folder on your desk, this first step will ensure that you have all your crucial documentation ready to go.
2. Make sure all of your transactional activity matches those statements.
Go through month by month and statement by statement and reconcile your statements with your entries. If something does not match, check to see if it was entered in your accounting system with the wrong date.
3. Look at all of the vendors you have worked with this year.
If you have vendors that have performed services for you (e.g. lawyers, accountants, professional coaches, etc.) and that you have paid at least $600 via check or cash in the year, you will need to issue them a 1099 income report.
4. Track down your receipts.
If you have bought any fixed assets – like furniture, vehicles, or equipment, track down those receipts now so that you have them ready for your tax returns and other reporting. It is better to have more information ready and available than to be chasing it down at the last minute.