ShindelRock’s Year-End Checklist for Small Businesses

As the year comes to a close, small business owners have a valuable opportunity to wrap up their financial matters and strategically plan for the future. This guide outlines a checklist to streamline year-end processes and maximize financial opportunities:

  1. Balance S-Corp Owner Wages and Health Insurance Reporting:
    • Confirm the submission date for the last payroll of the year with your payroll providers before the last week of December.
    • Ensure S-Corp owner wages comply with IRS guidelines and are reasonable for the business.
    • Accurately report health insurance premiums to optimize deductions.
  2. Prepare for 2023 Informational Returns (Forms 1099 – INT/DIV, 1099-MISC/NEC, 1099-R, and W-2, etc.):
    • Review payment records for contractors and employees in 2023. Note that starting January 1, 2024, electronic filing is required for taxpayers filing 10 or more informational returns.
    • Verify the completeness of 1099 vendor records. Request missing identifying numbers or addresses from vendors using Form W-9.
  3. Report Cash and Non-Cash Fringe Benefits:
    • Review records of personal use of business assets (e.g., vehicles, phones) and separate personal expenses for tax purposes.
    • Identify other potential fringe benefits that should be reported on a W-2.
  4. Boost Deferrals to Retirement Plans (401(k)s):
    • Review year-to-date retirement plan elective deferrals (e.g., 401(k), Simple IRA) for owners to maximize retirement savings.
  5. Address State FTE (Flow Through Entity) Tax and Other State Estimates Before Year-End:
    • Make state FTE tax and other estimated state tax payments before year-end to maximize deductions and avoid penalties.
  6. Ensure Documentation for Deductions and Credits:
    • Organize necessary documentation (receipts, invoices) for deductions and credits to facilitate a smooth tax season.

As a small business owner, taking proactive steps now will set the stage for a financially prosperous new year. Contact ShindelRock for experienced tax advisors to help you make the most of this year-end financial review.