Bookkeeping · 8 min read
Year-End Bookkeeping Close Checklist
A clean year-end close turns tax prep into a 1-week project instead of a 6-week panic. Run this list in January and your CPA can actually plan, not just clean up.
Reconcile every account through 12/31
- All bank accounts to the December statement
- All credit cards to the December statement
- Loans and lines of credit — match book balance to lender statement
- Merchant processors (Stripe, Square, PayPal) — clearing to zero
- Payroll liability accounts — match to last 941 and state filings
Clean up the balance sheet
- Accounts Receivable — write off uncollectible balances
- Accounts Payable — confirm every open bill is real
- Inventory — count and adjust to physical count
- Fixed assets — record additions, retire disposals, update depreciation schedule
- Owner's Equity — investigate any unexplained changes
Adjusting journal entries
- Depreciation and amortization for the year
- Accrued payroll, payroll taxes, and bonuses
- Loan principal vs. interest split
- Reclass owner draws / contributions out of expenses
- Prepaid expenses — recognize portion consumed
- S-Corp health insurance to the right account
