What Business Owners Need to Do Before Tax Season Starts

Tax season has a way of sneaking up on business owners. One day you’re focused on daily operations, and the next you’re scrambling to gather documents, answer questions, and figure out where your numbers stand. The good news? A little preparation before tax season begins can save you time, stress, and costly mistakes.

Here’s what every business owner should do before tax season starts.

1. Make Sure Your Books Are Up to Date

Before anything else, your bookkeeping should be current and accurate. This includes:

• All income and expenses entered

• Bank and credit card accounts reconciled

• Payroll recorded correctly

• Owner contributions and distributions properly classified

  
  

Clean, up-to-date books ensure your tax preparer is working with accurate information and reduces the risk of amendments or IRS notices later.

2. Organize Receipts and Documentation

Receipts still matter. Make sure you have documentation for:

• Large purchases

• Meals and travel expenses

• Equipment and asset purchases

• Business-use portions of shared expenses

  
  

Keeping digital copies stored securely makes it much easier to support deductions if questions arise.

3. Review Income and Expenses

Before tax season, take time to review your Profit & Loss statement. Look for:

• Missing or misclassified income

• Personal expenses mixed into business accounts

• Unusual spikes or drops in expenses

  
  

Catching issues early gives you time to correct them before filing deadlines.

4. Confirm 1099 Requirements

If you paid contractors or vendors during the year, confirm whether 1099s are required. Make sure you have:

• Completed W-9s on file

• Correct payment totals

• Accurate vendor information

  
  

1099s are typically due by January 31, so this step should be handled early.

5. Review Payroll & Owner Pay

Confirm payroll records are accurate, including:

• Employee wages and withholdings

• Payroll tax payments

• Owner compensation (especially for S-Corps)

  
  

Errors in payroll can delay filings and create compliance issues.

6. Prepare for a Conversation With Your Tax Professional

When your books are clean, your tax professional can focus on strategy, not cleanup. Be prepared to discuss:

• Major purchases or asset additions

• New loans or financing

• Business changes (growth, new locations, partners)

• Estimated tax payments made during the year

  
  

Why Preparation Matters

Preparing before tax season:

• Reduces stress and last-minute scrambling

• Minimizes errors and penalties

• Saves time and money

• Helps you understand the true financial health of your business

  
  

At Accurate Bookkeeping Solutions, we help business owners enter tax season confident, not guessing, by keeping their books clean, accurate, and ready for their tax preparer.