For automotive shop owners, tax planning is an ongoing process. You should meet with your accountant at least once a quarter to review your financials, expenses, major purchases, cash reserve, payroll, etc., and make needed course corrections.
Below is a general list of tasks that should be done by the end of the year to prepare for tax season, which is right around the corner.
- Schedule a meeting with your accountant and ask if any information, reports, or documents are specific to your business.
- Update your inventory and run a report for December 31.
- Review your and your employee’s retirement accounts; fund them if needed before the end of the year.
- Purchase equipment, vehicles, etc., to reduce taxes ONLY after discussing with your accountant and coach.
- Check your accounts/receivables and print a report with a closing date of December 31.
- Prepare a list of any uncollectable debt for your accountant.
- Prepare your accounts/payables. Determine which bills will be paid in the current year.
- Ensure that all loan interest income and expense is properly itemized on your P/L.
- Ensure that all major equipment purchases are properly itemized on your balance sheet.
- Prepare any investment dividends documents. You may need to wait until January to obtain these documents.
- Make sure you have all receipts and records for any capital improvements or leasehold improvements made this year.
- Contact your attorney for any required corporate meetings, filings, etc.
- Discuss with your accountant how to payout any end-of-year employee or corporate officer bonuses.
- Ensure that all payroll information and worker’s compensation information are correct.
Remember, preparing now may save you from paying too much in taxes and will relieve stress from your life.
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