The Year-End Financial Checklist Every Small Business Owner Needs
Close your books with confidence. This step-by-step checklist covers everything you need to do before the year ends — and sets you up for a strong start to the new one.
Year-end is when most business owners realize they should have been paying more attention to their books all year. Sound familiar? Don't worry — you're not alone, and it's not too late.
Whether your books are pristine or a little (okay, a lot) behind, this checklist will help you close out the year cleanly, maximize your deductions, and walk into January with a clear financial picture.
Reconcile all accounts
- Reconcile every bank account through the current month
- Reconcile all credit card statements
- Clear any old outstanding checks or deposits that won't clear
- Verify your opening balances match your prior year's closing balances
Pro tip: This is the foundation. If your reconciliations are off, everything else will be too. If you're behind, this is the time to catch up — or bring in a professional to do it for you.
Review your Chart of Accounts
- Merge or delete duplicate accounts
- Inactivate accounts you no longer use
- Make sure income and expense categories are consistent with how you'll file taxes
- Verify sub-accounts are properly nested
Pro tip: A messy Chart of Accounts leads to messy reports. Clean it up now so your year-end financials are accurate and your CPA doesn't charge you extra to sort through the chaos.
Maximize your deductions before December 31
- Prepay January expenses (rent, insurance, subscriptions) if cash flow allows
- Make equipment or software purchases you've been putting off
- Contribute to your retirement account (SEP IRA, Solo 401k)
- Donate to qualified charities and get receipts
- Pay outstanding invoices to contractors so they hit this tax year
Pro tip: Every dollar you can legitimately shift into this tax year is a dollar that reduces your taxable income. But timing matters — talk to your tax advisor before making big moves.
Prepare for 1099 season
- Collect W-9 forms from every contractor you paid $600+ this year
- Verify contractor names, addresses, and EINs/SSNs are correct
- Review your records to ensure all contractor payments are properly categorized
- Set a reminder: 1099s must be filed by January 31
Pro tip: Don't wait until January to scramble for W-9s. Start collecting them now. Missing or incorrect 1099s can result in IRS penalties.
Review your financial statements
- Run a Profit & Loss statement for the full year
- Run a Balance Sheet as of December 31
- Compare this year's numbers to last year — look for anomalies
- Check for any transactions that look miscategorized or unusual
- Review accounts receivable — follow up on anything outstanding
Pro tip: This is your chance to catch errors before your books are 'closed' for the year. It's much easier to fix a miscategorized expense now than after your taxes are filed.
Plan for next year
- Set a revenue target and break it down by month
- Create a budget based on this year's actual expenses
- Review your pricing — are you charging enough?
- Identify services or expenses to add or cut
- Schedule a meeting with your bookkeeper or CFO to review the plan
Pro tip: The best time to plan for next year is while this year's numbers are fresh. Use your year-end data to set realistic, informed goals — not guesses.
Don't wait until December 31
The best time to start your year-end financial review is Q4 — not the last week of December. Give yourself (or your bookkeeper) enough runway to catch errors, maximize deductions, and close the year without stress. Your future self will thank you.
Need help closing out the year?
Whether you need catch-up bookkeeping, year-end cleanup, or a full financial review, we've got you covered. Let's make sure your books are buttoned up before the new year.