General Year-End Financial Checklist

You should receive an organizer that provides a checklist of what you should provide.

Here are a few items that I will be focusing on.

  • Do you have an IP PIN issued by the IRS?
  • Do you have any Virtual Currency activity? IF so, we will need to determine any gains or losses.
  • If you sold your home or any other real estate properties, please provide both the sale and the original purchase price along with any improvements made to determine cost basis.
  • Year end documents from financial institutions such as Merrill Lynch – please provide all the pages. The supplemental pages will list any advisor fees / investment expense and identify stocks sold as short term or long term.
  • Any IRAs to report? Make sure you are meeting your RMD (Required Minimum Distributions) requirements.
  • Please provide deductible expenses such as medical, employee business expenses. While many will not be deductible at the federal level because of the high standard deduction amount or limitations, at the state level it may be deductible. One reason is that California does not conform to the federal level and has its own set of calculations for income tax at the state level.
  • Proof of Health Insurance coverage.
  • Charitable Contributions
  • Business Use of Home. Do you work from home? First, need to determine if you qualify. If so, then figure out what expenses can be deducted.
  • Any household employees? If you have household employees on payroll, there is a good chance everything is set up properly. However, not all income tax liability due may have been submitted by payroll vendor and the liability may be added to your income tax return.
  • If you have any questions about your cash flow in the future, you can provide year end accounting statement which has the values of your portfolio. I would be more than happy to discuss with your financial advisor what the goals are, etc.

Supporting Documents & Receipts

  • Any supporting or missing documentation should be collected by year end

Tax Preparation

Lists/receipts/documentation required:

  • Deductible Expenses
  • Retirement Plans
  • Capital Gains
  • Distributions
  • Charitable Contributions

1099 Reporting

Vendor & Employee W9s and W4s: Vendor Maintenance

  • Each vendor must have their W9 on file with you, complete with entity type, EIN or SSN, and address.
  • Immediately contact vendors for missing W9s or any missing information on existing W9 forms. (Coding vendors by entity type within your accounting software saves time when filtering later.)
  • If vendor is 1099 eligible, your accounting software should have the ability to track 1099 payment information.​

Compliance

Review license renewal requirements:

All licenses and permits should be reviewed yearly and renewed if due to avoid lapses and penalties, and to also ensure compliance. This includes business licenses, city licenses, sales tax, and any industry-specific licenses or permits.

If you have intellectual property rights that need to be protected, patents, copyrights and trademarks may be appropriate and should be applied for.

HR and Benifits:

Review PTO Policies

Review and reconcile employee PTO in case of any liability adjustments for accumulated balances.

Verify Bonus, Commissions & Incentives

  • Calculate any year-end payouts
  • Evaluate policies and decide if these compensations should be adjusted for next year

Review Employee Appreciation/Recognition Programs

Decide if your current program is effectively contributing to the job satisfaction of your employees and the success of your company.

Information Technology

Back Up Files

  • Clean up files, and eliminate unnecessary, irrelevant data
  • Keep backups of ALL important data related to your business in case of data breach or disaster.

Technology Evaluation

  • Review Security Policies
  • Perform Vital Software/Malware Updates
  • Check Out Newer, Faster Applications for Business Efficiency

Filing Requirements

Some businesses require periodic updated reports:

  • Articles of Amendment – Check to see if your business requires articles of amendments filed annually in case of any changes to a business address, name, purpose, and/or members.
  • Annual Reports - Check to see if your business requires an annual report and board meetings.
  • Entity Conversion - If you have changed your business structure, your state will have specific documentation and filing requirements. Check these requirements carefully to remain in compliance.

Resource Requirements

If you are revising next year’s budget and business plan, now is a good time to evaluate staff investment, technology upgrades, Covid and operating expenses, training costs, etc. and make changes, upgrades, or downgrades for optimal performance.