Wrapping Up Finances for 2023

We say it every December, but now is the perfect time to audit your finances and prepare for tax season. Follow these steps to start the new year with your best financial foot forward.

Getting Ahead of Tax Season

For small and medium businesses, give your tax professional plenty of time to sort through your documents. You’ll likely need extra time for additional questions, information, or adjustments. 

Collect the right files

Before meeting to discuss your taxes, get these documents in order. Your financial consultant will need them to inform decisions and file your taxes.

• A form of ID: Anyone helping with your taxes is required to ask for your ID.
• Your business tax ID: This will either be your social security number or your employer identification number. 
• Categorized and itemized business expenses: This helps your consultant determine what deductions or credits you qualify for.  
• Your financial records for the year: At the very least, this includes receipts and invoices from sales and services, interest from business bank accounts, any income, deductible business expenses, and the amount you’ve made on inventory through the year. 

Learn more about the right filings for your specific situation. 

Talk with your CPA

No matter your financial plan, things will turn out differently than expected. That’s why it’s important to meet with your CPA before filing. Last-minute adjustments may be key for lowering your tax liability. Take time with your tax professional to consider:

• Deductions or credits you’ve qualified for.
• Shifts in federal and state tax code.
• Expediting expenses or delaying income.

With the right time and resources, your CPA can find you the best tax outcomes. 

Know your deadlines

Whether you pay taxes all at once or in estimated quarters, these key 2024 tax dates will keep your business in line.

• January 16, 2024: Fourth quarter estimated taxes are due. 
• January 31, 2024: Employers must send all W-2s (and some 1099s).
• April 1, 2024: If you turned 73 in 2023, your required minimum distribution is due. 
• April 15, 2024: File your taxes! (Or request an extension.) First quarter estimated taxes are also due.

Bookkeeping practices for a happy new year

Going into the new year is a great time to establish best practices. Take a step back, look at your financial big picture, and set goals for 2024. 

Run your go-to financial reports

Run financial reports with an eye on the past and the future. You’ll likely want to generate an income statement, balance sheet, and cash flow statement. 

Ask yourself, how is your financial standing? Is it where you expected it to be? Is it lower or higher than past years? Use that information to set intentions and make informed decisions.

Look for trends 

Important context comes from reviewing reports alongside previous years’. You can begin to identify ongoing trends and issues. 

Look for recurring problems you’ve faced. How might you avoid that mistake in the future? Cash flow statements can be a huge help here. What stalls in cash flow did you face and why?

Put a bow on 2023

You want your finances fully in order for 2024. Check that all bills are paid and follow up on outstanding invoices. Collecting payments gives your business a cash boost to start off the year. 

Amidst the chaos, take time to be grateful for your employees and their work. Maybe there’s last-minute room in the budget for a gift. At the very least, say thank you. 

Step back and look forward

Naturally, the end of the year is an opportunity to look back and look forward. Find time to reflect on:

• Goals you set for 2023
• Goals you want to set for 2024 (new or updated)
• Long term goals and benchmarks along the way
• Additional staffing needs 
• Your year-end evaluation and record keeping processes
• Your internal leadership

Meet with your financial professional 

At SME CPAs, year-end signifies a celebration of our clients’ accomplishments — and a push to do our best work through tax season. Whether you’re a longtime partner or brand new to the family, we welcome your calls and visits. Let’s sit down together to figure out what 2024 looks like for you and your business.