Nine Year-End Tax Recordkeeping Reminders

Do you ever do something once a year and wish you kept notes to refer back to so you didn’t have to learn it all over again?  Well, here it is…your reminder of what to do for tax recordkeeping at the end of each year!

  1. Write down the odometer reading on the vehicles you use for business. It is important to know what percent you are using the vehicle for business and the amount for personal. You should have a mileage log, but even if you just write down your odometer once a year, you’ll know the number of total miles you drove for the year.
  2. If you carry inventory, you are required to do a count once a year showing the value. Make sure your records are accurate.  If you notice any discrepancies, it might be a good idea to investigate to be sure you are not experiencing any internal loss. 
  3. Collect any W-9’s from vendors. Verify if you paid anyone over $600 that will require a 1099. You will also need to send out a 1096. Call the IRS to get FREE forms: 1-800-829-3676 (will take 2 weeks to receive forms.)
  4. If you have payroll, verify if your state unemployment tax rate has changed for the upcoming year. You should have received a letter with the percentage in early December.
  5. Copy thermal receipts. Many receipts that you get from office supply stores, gas stations, etc. are on thermal paper. The image will fade over time. Make a copy of the receipt because if you are audited, the IRS will want to see the details, not the credit card statement.
  6. If applicable, verify when corporate minutes will be due for the coming year and mark the calendar.
  7. Back up data from the computer. Double check that the backup is copying correctly.
  8. Review your business plan and make any necessary changes. What do you project your gross revenue to be for the upcoming year? How will that compare with last year? What will you do to increase your profits for the upcoming year?
  9. If you use QuickBooks software, set the closing date and password on your QuickBooks file. 

In January, we’ll have more tips for you on how to get your documents together for your tax preparer, but for now, this is enough to do!