As the year comes to a close, it’s time to tie up loose ends and prepare for a strong financial start to the new year. At Klinger & Associates, we’re committed to helping our clients stay organized and informed. Here are the key year-end tasks we recommend tackling to ensure your financial health and tax readiness:
1. Review Financial Statements
- Assess year-to-date profit and loss statements.
- Compare this year’s performance to prior years and identify trends.
- Ensure all expenses and income are properly recorded.
2. Maximize Tax Deductions
- Identify opportunities to accelerate deductible expenses or defer income.
- Consider prepaying expenses like subscriptions if it makes financial sense.
- Review charitable contributions and gather supporting documentation.
3. Plan Retirement Contributions
- Maximize contributions to retirement accounts like IRAs or 401(k)s.
- If self-employed, evaluate SEP IRA or Solo 401(k) contribution limits.
- Ensure any contributions are made before year-end deadlines.
4. Evaluate Your Business Entity
- Is your current entity structure still the best fit for your goals?
- Consider potential tax benefits of changing entity types, like transitioning to an S corporation.
5. Organize Records for Tax Preparation
- Gather W-2s, 1099s, receipts, and other essential documents.
- Reconcile bank and credit card statements.
- Ensure payroll and sales tax filings are up to date.
6. Review Year-End Bonuses and Payroll
- If issuing bonuses, determine the tax implications for your business and employees.
- Confirm payroll tax deposits are accurate and timely.
- Ensure compliance with year-end reporting requirements for W-2s and 1099s.
7. Perform a Year-End Inventory Check
- Count inventory on hand and compare it to recorded amounts.
- Write off obsolete or damaged goods.
- Adjust records to reflect true inventory levels.
8. Plan for Next Year’s Goals
- Set measurable financial and operational goals for the upcoming year.
- Develop or update your budget.
- Schedule regular reviews of your financial performance.
9. Schedule a Meeting with Your CPA
- Discuss your current tax situation and estimate any payments due.
- Strategize tax-saving opportunities for next year.
- Address changes in your financial situation, like retirement or new investments.
10. Consider Estate and Gift Planning
- Review your estate plan and update beneficiaries.
- Take advantage of the annual gift tax exclusion if applicable.
- Consult with your CPA and attorney to ensure alignment with your long-term goals.
Why Acting Now Matters
The steps you take before December 31 can significantly impact your tax liability and financial standing. Don’t leave money on the table or risk non-compliance by delaying these important tasks.
If you need assistance with any of these year-end to-dos, Klinger & Associates is here to help. Contact us today to schedule a consultation and ensure your financial house is in order for the new year.
Start the New Year with Confidence Taking care of your year-end checklist isn’t just about compliance—it’s about creating a solid foundation for growth. Let us partner with you to achieve your financial goals.