Tax season is just around the corner, and if your books are behind, you’re not alone. Many small business owners find themselves scrambling to organize their financial records before filing deadlines. The good news? It’s never too late to get your books in order and avoid unnecessary stress. Here’s a step-by-step guide to catching up on your bookkeeping before tax time.
1. Gather All Your Financial Records
Start by collecting all your financial documents. This includes:
- Bank and credit card statements
- Receipts for expenses
- Invoices issued to clients
- Payroll records (if applicable)
- Loan and lease agreements
Having everything in one place will make the next steps much easier.
2. Reconcile Your Bank and Credit Card Accounts
Reconciliation ensures that your records match your bank statements. Go through each transaction and:
- Verify deposits and withdrawals.
- Categorize expenses correctly (e.g., office supplies, travel, marketing).
- Investigate any discrepancies or missing entries.
If you’re using bookkeeping software like QuickBooks Online, this process can be automated for efficiency.
3. Organize Income and Expenses
Sort your income and expenses by category. This will help you:
- Identify deductible expenses for tax purposes.
- Get a clear picture of your business’s profitability.
- Prepare for financial reporting and tax filing.
Use a consistent system to categorize transactions, whether it’s based on IRS tax codes or your own customized chart of accounts.
4. Run Key Financial Reports
Once your accounts are reconciled and transactions are categorized, generate the following reports:
- Profit & Loss Statement: Summarizes your revenue and expenses to show your net income.
- Balance Sheet: Provides an overview of your assets, liabilities, and equity.
- Cash Flow Statement: Tracks cash inflows and outflows to help you manage liquidity.
These reports are essential for filing taxes and understanding your business’s financial health.
5. Address Any Overdue Invoices or Bills
If you have outstanding invoices or unpaid bills, now is the time to follow up:
- Send reminders to clients with overdue payments.
- Pay any overdue bills to avoid late fees and penalties.
Keeping these accounts current will streamline your tax preparation process.
6. Review Payroll Records
If you have employees, ensure your payroll records are accurate and up-to-date. Verify:
- W-2s and 1099s are ready for distribution.
- Payroll taxes have been calculated and submitted correctly.
This step is critical to avoid errors or penalties.
7. Set Up a System to Stay Organized Year-Round
Catching up on bookkeeping can be stressful, so take steps to prevent falling behind in the future:
- Schedule regular bookkeeping sessions (e.g., weekly or monthly).
- Use software like QuickBooks Online to automate and simplify tasks.
- Consider hiring a professional bookkeeper to manage your records year-round.
How Allgood Bookkeeping Can Help
Feeling overwhelmed? At Allgood Bookkeeping, we specialize in catch-up bookkeeping and helping small businesses get back on track. We’ll:
- Reconcile your accounts
- Organize your income and expenses
- Prepare accurate financial reports
With our expertise, you can focus on running your business while we handle the books.
📅 Contact us today and make tax time stress-free!
Allgood Bookkeeping 
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