When I say Year End, what do you think about?
That last big marketing push to close as much business as possible before New Year’s Eve?
Figuring out who to send gifts to? Who to send a card or thank you email to?
Who to invite to that holiday mixer?
Whatever you think about, I’ll bet it isn’t any of the things you need to do to eliminate Year End Tax Drama.
Now is the perfect time to start your year end clean up so you’re ready for that all-important sprint into 2019.
Recently my business partner Warren Taryle and I recorded a video discussing the things you need to start on now to wrap up 2018 with some degree of order.
Let’s face it, spending your January weekends knee deep in receipts, invoices and empty pizza boxes is no fun.
And since Warren is a CPA who specializes in tax strategy, he knows how frustrating it can be for clients when they find out they could have saved thousands in taxes if they had only seen their accounting professional before year end! Yes, that’s right – thousands.
Q1 isn’t that far away, and you’ll want to be ready to put all your time and focus on your exciting new projects – not fretting over 2018 tax requirements.
So, to save our bizEngaged Members from the coulda … woulda … shouldas of 2018 tax prep, we’ve put together a list of things you need to jump on now.
To listen to the entire 70-minute discussion, log into the Membership area of www.bizengaged.com and select Recorded Calls from the 'Modules' menu at the top. Not a Member yet? Go to www.bizengaged.com/monthly-membership/ and sign up.
In case you don’t have 70 minutes right now or can’t take notes, here’s a brief summary to get your started.
If your business owns your car, you will need to bring your mileage log up-to-date to determine the % of personal mileage versus business mileage.
Hint: If you’ve been lax in keeping that mileage log, listen to the video for tips on how to remedy the situation starting now.
Track down all your receipts, write in any required notes on the face, scan them in, and send the files to your Bookkeeper now.
Hint: bizEngaged Members – if you don’t know which meals and entertainment you can write off under the new tax rules, listen to the Meals and Entertainment educational module in the Financial Section of the Membership area.
Record any loans for amounts greater than $500 and lasting longer than 6-12 months in the form of promissory notes. Listen to the video for the discussion on what interest rates to use. Create resolutions to accept the notes.
Hint: bizEngaged Members – you can find a simple Promissory Note template in the Tools section of the Membership area.
Create resolutions for these purchases and asset sales to show you are acting as a responsible manager of your business.
Create the resolution that allows you to expense rather than capitalize individual items costing less than $2,500 and remind your CPA to check that box.
Hint: bizEngaged Members – look in the Tools section of the Membership area for a copy of this resolution.
Find all service vendors that are not corporations and that you have spent $600 or more with this year. Find all attorneys – they need a 1099 regardless of amount.
Hint: Make sure you give to your CPA any 1099s you receive for services you provided.
If you have contracts between 2 of your companies, ensure the contracts are professional and qualify as legal contracts.
Determine the % of your home that is occupied exclusively by your business.
Create a spreadsheet of all home expenses, including any upgrades, repairs etc.
Take pictures of your office space.
Give everything to your CPA.
Create resolutions for all decisions of legal, tax and financial significance. Did you know the IRS is asking for company minute books when they audit?
Hint: bizengaged Monthly Members - get the Start Your Company Meetings and Minutes workbook and resolutions template book for FREE by using the code we sent you after your first monthly billing. Look for the Checklist in the workbook for everything you need to document.
Make sure you filed your annual report, renewed business licenses, filed sales and use reports and business personal property tax reports if required. Enter filing dates on your 2019 calendar.
If you have employees make sure you filed all necessary paperwork for payroll.
Hint: bizEngaged Members – watch for the Payroll Video from Warren Taryle to be posted later in November.
Make a list of K1s and 1099s you should receive from other companies and give to your CPA.
Give your resolution Checklist to your CPA with pertinent information filled in including changes of entity structure, tax election, ownership or purpose.
Ensure you CPA has your entity EIN(s), IRS confirmation letters for change of tax election, and state filed formation articles or certificates.
After your accounting books are up-to-date send a copy to your CPA with an estimate of income and expenses to the end of the year. Include your car % personal versus business mileage and the spreadsheet for your home office.
Hint: Make sure you give your CPA any required passwords.
Your CPA may be able to help you save taxes if you change your entity structure or bring forward or delay income or expenses. Make sure you give them all the information they need to give you the best service.
Don’t assume that a CPA you met at a mixer will remember you or consider you a client. Make sure you have hired your CPA and gone through their intake process.
Hint: Good CPAs are in hot demand. Make sure yours is hired now!
Create your goals, strategies and forecasts for the New Year.
Hint: Yes, these may change; but better to start now and refine later than discover in June that you never started.
If you tackle this list just an hour at a time, you’ll be able to focus all your energy on starting 2019 with a bang rather than spending your weekends frantically searching for the information you need to close out the books on 2018.
Get started now.
To Your Awesome Success,
Wendy Byford and Warren Taryle, CPA
PS: Not a bizEngaged Member yet? Go to https://www.bizengaged.com/monthly-membership/ and sign up. Get access to all our educational videos, interviews, Live Q&As and Tools.