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Accounting Tasks for the New Year

January is a huge month for business owners. After the year is over, there is a lot that needs to be done to wrap up the past year. What should be on your radar and what needs to get done ASAP? This article will walk you through some of those items.

January is a huge month for business owners. After the year is over, there is a lot that needs to be done to wrap up the past year. What should be on your radar and what needs to get done ASAP? This article will walk you through some of those items.

1. 1099s and W2s are due January 31st

Business owners need to issue 1099’s to individuals (not employees) they paid at least $600 for services, rent, prizes, or other types of income during the calendar year 2021. You do not need to file a Form 1099-NEC for services provided by a corporation unless the corporation performed legal or medical services.  Collect W-9 forms from all your contractors (to obtain their taxpayer identification number) and don’t forget to issue W-2 forms to employees.

2. Time for Tax Preparation

Returns are due March 15th for Partnerships and S-corps, or April 18th for C-corps and Sole Proprietorships. Having a CPA, attorney, or enrolled agent prepare your business tax returns is usually safer than trying to do it on your own. Tax filing software is usually easy to use but an actual person may know more about current laws and what’s best for your business in the long run. Tax penalties and interest can build up fast. Save your tax documents and work with a professional to make sure your return is filed on time. Also, don’t forget about making required quarterly estimated tax payments to avoid penalties for late payments.

3. Work With a Bookkeeper to Close Your Books (ASAP)

Have an updated Balance Sheet and Income Statement for your tax preparer. Before you send your financials to your tax preparer, review your financials, payroll reports, and pull a general ledger to review your transactions. Send end-of-year loan statements and an updated inventory count to your bookkeeper. It’s always a good idea to set up a quick meeting with your CPA and bookkeeper in January to touch base and go over the to-do items.

4. Set New Financial Goals

Don’t just prepare financials for tax purposes; use your financials to see how you can improve next year. What was your highest expense? Can it be reduced? When did you make the most money? How can you do better this year? Don’t forget to celebrate and reward your employees for last year’s accomplishments as well.

Why KPMG Spark?

When you sign up for KPMG Spark, you get full access to our managed accounting platform which helps you get ready for tax season. Our accounting platform has all three pillars of managed accounting with an efficient online accounting platform, capable machine learning technology, and a trusted specialized bookkeeper who works with your team. At KPMG Spark, our platform actually helps you do less while completing more. To learn more about the KPMG Spark managed accounting solution, give us a call at 1-855-777-7696.

 

The views and opinions expressed herein are those of the author and do not necessarily represent the views and opinions of KPMG LLP.

This blog article is not intended to address or provide advice concerning the specific circumstances of any particular individual or entity and does not constitute an endorsement of any entity or its products or services.

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.

The following information is not intended to be “written advice concerning one or more Federal tax matters” subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser .

Olivia MooneyJanuary 19, 2022Posted In: Tax Tips

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