Year-end is when every loose end in your books shows up at once. A missing statement, a payment nobody coded, a vendor without a W-9. None of these are hard to fix in December. They are much harder to fix in March, when your CPA is waiting and the deadline is close.

This guide walks through the checks that matter most. Work through them in order, and you will hand your CPA books they can use straight away.

1. Reconcile every account through December 31

Start with your bank, credit card, loan and payment processor accounts. Each one should be reconciled to its December statement, with any difference explained. If some months were skipped during the year, go back and reconcile those first. A year-end balance is only right if every month before it is right too.

Look closely at old uncleared items. A check from last spring that never cleared, or a deposit that sits unmatched, usually means something was entered twice or never happened.

2. Tidy up what customers owe you

Run your accounts receivable aging report. For each open invoice, ask a simple question: will this really be paid? Follow up on the ones that are late. If an invoice will never be collected, talk to your CPA about writing it off, so your income is not overstated.

Also check for customer payments that were recorded as new income instead of being matched to their invoice. This is a common reason the aging report looks worse than reality.

3. Check what you owe

Run your accounts payable report and compare it with vendor statements. Remove duplicate bills, record any December bills that arrived late, and make sure paid bills are marked as paid. Your loan balances should match the statements from your lender, with each payment split between principal and interest.

4. Review payroll for the year

If you have employees, compare the payroll totals in your books with the year-end reports from your payroll provider. Wages, employer taxes and benefits should agree. Confirm that employee names, addresses and Social Security numbers are correct in your payroll system, because Forms W-2 are due to employees early in the new year.

5. Get ready for 1099s

Make a list of the contractors and other vendors you paid during the year, and check that you have a W-9 on file for each one. The rules on who needs a Form 1099 and the dollar threshold depend on the year the payments were made. Our guide to 1099 basics for 2026 explains the current rules, and the 1099 vendor checker helps you sort vendors one at a time.

6. Count and value inventory

If you sell products, count what you have on hand at year-end and compare it with your books. Adjust for items that are damaged, lost or no longer sellable. Your cost of goods sold, and so your profit, depends on this number being right.

7. List big purchases and owner activity

Pull together a list of equipment, vehicles and other large purchases made during the year, with dates and receipts. Your CPA decides how to treat them on your return. Do the same for money you put into the business or took out of it, so owner contributions and draws are not mixed up with income and expenses.

While you are at it, move any personal expenses out of business accounts. Mixed spending is one of the most common clean-up jobs we see.

8. Send your CPA one clean package

When the checks are done, send your CPA everything at once: year-end reports, reconciliation reports, the 1099 vendor list, payroll summaries, the list of large purchases and a short note of anything unusual. One complete package saves a long chain of emails and questions.

The bottom line

Year-end goes smoothly when the books have been kept up all year. If yours have fallen behind, start now, account by account. Every month you bring current is one less thing to sort out under deadline pressure.

We keep books tax ready all year and offer a year-end review that works alongside your CPA.

General information only, not tax or legal advice. Your CPA can confirm what applies to your business. Questions? Book a free 30-minute consultation.