The year is fast drawing to a close, yet you have not checked your financials; what are you going to do?
Before you know what to do, you understand too well that you could be in trouble unless you have your records checked.
You may be late preparing year-end financials, but you can save the situation by acting fast. You only need to find a professional financial services provider to help you reconcile documents and get everything in order. It all depends on how swift you are.
If you are worried that your document preparation may not meet the deadline, here are a few things to consider if you want to fix the situation fast.
Do You Have All the Documents You Need?
As you prepare your year-end financials, one of your first steps should be to ensure that you have everything you need. If it’s been a while since you looked at all of your documents, take a few minutes to refresh yourself on what’s available. And if it has been too long, start gathering up what you need now.
These documents may include:
- Old pay stubs
- Charity Contributions
- Bank statements
- Other financial notifications
Remember, not having enough documents can lead to a time-consuming audit, which no small business owner wants on their plate when they should be focused on getting ready for tax season. To help you get organized and stay accountable with each step of your progress, consider using an essential checklist or calendar outlining what you have left to do.
Just a reminder: You want to submit all of your necessary documentation before the deadline because any last-minute additions could push back your filing date significantly.
Have You Reviewed What You Have?
It’s best to have your financial documents reviewed by a professional before submitting them, but that’s not always an option.
If you do it yourself, go through each document carefully and check your math before submitting anything. That way, if there are any errors or even misunderstandings on your part, you can correct them while you still have time.
If something is unclear or seems incorrect after reading it multiple times, try checking it by a second source. There’s a difference between gross income and reportable income, so be sure to double-check what goes into each of those categories, so you don’t accidentally put down too much—or too little—as taxable income. You should also know the difference between gross and reportable income.
Are There Additional Documents Required?
Businesses with employees, contractors, or other third parties on their payroll will need W-2s and 1099s. Other companies will only need to fill out a Schedule C if they expect to owe more than $1,000 in income tax, but every business should gather their receipts and statements from vendors.
In most cases, you won’t pay your taxes until later next year, but completing these documents in November means you don’t have another thing to worry about in January and February. Having them ready when you meet with your accountant is an excellent way to make sure nothing slips through the cracks.
As for which form to use? You can find examples at IRS.gov, along with instructions for what goes where.
Be sure to check IRS Publications, which breaks down estimated tax payments by calendar year. If it seems too much work now, take comfort in knowing that many forms are easier than ever.
Do You Know the Year-End Financial Deadlines?
At some point, every business owner has to submit financial information, whether it’s for a loan or a grant or because you have so much inventory that you have to pay taxes on it. What about income tax? Are there year-end financial deadlines you should know about?
Your tax preparer will probably answer all of these questions and more, but if not, it’s essential to keep track of year-end financial deadlines yourself. You don’t want to find out six months after tax season that your accountant missed a critical deadline, and now you owe additional fees and penalties.
Have You Audited Your Accounts?
If you’re self-employed, chances are your accounts don’t need to be audited unless you’re planning on opening a bank account that requires one. And even if you are audited, most accounting software comes with financial reports that help accountants find errors in your bookkeeping.
However, if you want to know whether or not your accounts have been properly organized, it might be time to bring in an outside auditor to put everything above board.
If you’re ever unsure of how things should be organized or structured regarding finances, call in an expert who can provide insight and guidance. After all, accounting is their area of expertise. They know the latest regulations and how they affect people who are not experienced in this field.
Outsource Year-End Financials Preparation
Save yourself some time through year-end tax preparation outsourcing to an accounting firm. And while they prepare your taxes, make sure you get all of your financial documents in order.
Run through a list of important tax documents with your accountant, including 1099s, K-1s, and W2s. Also, make sure you have all asset records on hand, along with any other financial records that may be pertinent to filing your taxes.
A lot can change year over year—that’s why it’s important to stay organized during tax season. Year-end document preparation is one of those things that gets easy with practice, but don’t get overwhelmed if things get out of control at first.
Get Professional Year-End Financials Preparation Services
There is no doubt that you want to put your year-end financials in order, which is why you should look for professionals to help you throughout the process.
Since you know that outsourcing these services is one of the best options, you should start by finding the right professionals. Look for people who have experience in tax preparation and reviewing documents so that everything meets the requirements of the law.
If you need more information, you may refer to the many other articles we have published here on our website.