As I already pointed out in a previous post, we’re at the end of 2016. This year literally flew by! From a business perspective, now is a good time to have a sit down with your accountant to discuss year-end business planning.
Most people wait until tax time to speak with their accountants. Big mistake. You should actually build a relationship with your accountant and talk to them all year round. With that being said, see this year-end business planning as just one of the many meetings you should have throughout the year.
Here’s exactly what you need to talk to your accountant about this quarter as we round out the year.
Ask about what kinds of documents you should be expecting.
As we get closer to the first quarter of 2017, you may remember that clients may be sending over a ton of paperwork that you’ll need to file your federal tax return by April 15th.
The more complicated your business, and the more clients you have, the more paperwork you may get. This would be a good time to sit down with your accountant, pull out last year’s tax return and figure out what paperwork you’ll need to keep and eye out for.
Additionally, you may find that you may need to send paperwork to contractors you’ve hired throughout the year. Your accountant will be able to help you figure this out.
Determine your tax estimates.
According to Eric Nisall of Accountlancer, year-end business planning with your accountant is a great time to determine what your tax estimates will be in the future.
As you probably already know, as a freelancer or small business owner you need to pay quarterly taxes. The last thing you want is to get a surprise tax bill or penalties because you didn’t pay enough as the year went on.
How to avoid tax penalties.
Speaking of penalties, year-end tax planning is also a great time to make sure you’re not on your way to getting any tax penalties come April. This gives you time to may an extra tax payment or fix something if you need to.
See if there are any year-end tax moves you can make.
Year-end business planning usually goes hand in hand with year-end tax moves. This is the time of year where business may seek to reduce their tax bill by making some business purchases or donations.
Again, your accountant can help you figure out if you have time to make any year-end tax moves to reduce your bill to Uncle Sam.
Review the business finances.
One of the most important conversations you can have with your accountant for year-end business planning is that of business finances.
This is a good time to take a look at business revenue, costs, budgets and potential sources for revenue in the coming year, Unfortunately, many business owners are not aware of what is going on in their businesses financially, so this is a good time to take a look.
Year-end business planning with your accountant is an important part of running a successful business. By sitting down and discussing the financials, you ensure that you can build a profitable business for the long haul.