Year-end bookkeeping checklist
At year end, reconcile every bank, card and loan account, clean up unpaid invoices and bills, count inventory, check payroll totals against your W-2s, collect W-9s for 1099s, and review the profit and loss for anything miscategorized. Then close the year so the numbers stay put while your return is prepared.
Updated November 2026 · By Pankil Kumar, Managing Partner
Accounts
Customers and vendors
Assets and inventory
Payroll
Review and close
Why close the books at year end?
Your tax return is built from the books as of December 31. If an account isn't reconciled, or personal costs are mixed in, the return is wrong, and fixing it later costs more than fixing it now. Closing the year in QuickBooks Online or Xero, with a closing date, stops anyone from changing numbers after the return is filed.
What if I'm already behind?
If the year isn't reconciled yet, start with the bank and card accounts. Everything else depends on them. If several months or years are missing, look at catch-up bookkeeping, where we rebuild the books before the return is due.
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See our bookkeeping serviceWhen is the deadline to send 1099-NEC forms?
January 31, to contractors and the IRS. For payments made in 2026, the threshold is $2,000.
Do I need to count inventory at year end?
If you sell goods and carry inventory, yes. The count sets your cost of goods sold for the year.
What is a closing date in QuickBooks?
A setting that locks transactions before a chosen date, so the year you filed can't be changed by accident.
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