Q4 2025 Financial Checklist: 6 Tasks Every Business Should Tackle Before Year-End

Can you believe it? It seems like yesterday you were spring cleaning your finances, and today, we’re talking about an end-of-year financial checklist.

What you do today to close out the year strong will help guide you in 2026.

We have a lot to cover, but it’s worth the effort to end the year off on the right foot.

6 Tasks That You Need on Your End-of-Year Financial Checklist

1. Review Year-To-Date Financials

Your year-to-date financials help you spot:

• Financial trends: Analyze your financial statements and compare them to your previous reports. Use this information to spot cash flow, expense and revenue trends in your business.
• Potential issues: Discrepancies and unusual expenses often worsen over time. Your review will allow you to make the necessary adjustments to prevent small issues from becoming larger ones in the future.

Your financial statements will enhance your decision-making and enable you to approach the New Year with confidence. Work with a bookkeeper (if you’re not already) to clean up your books before handing them over to your accountant.

2. Optimize Year-End Tax Strategies

Decisions that you make while checking off items on your end-of-year financial checklist can save you a lot of money come tax time. You’ll want to review these with your accountant, but they can include things like:

• Deferring income. If you can afford to do so, wait to send out that large invoice until after December 31st. Deferring income allows you to save money on taxes until the next quarter, but only follow this recommendation if you have the cash flow to comfortably wait to be paid.
• Accelerating deductions. Often, combining deferring income with accelerating deductions is recommended. You can deduct expenses by paying them ahead of time. For example, pay your utility bills or rent in advance. You can also do this with employee bonuses for the year.

Section 179 deductions were raised to $1.25 million in 2025 and allow you to depreciate equipment, software and other investments in the current year. 

Also consider bonus depreciation for eligible property. 

Of course, there are a lot of other year-end tax strategies that your tax accountant can walk you through to minimize your tax burden.

3. Update Payroll and Benefits Before W-2/1099 Deadlines

Your employee and contractor records must be accurate. And throughout the year, there are changes that can lead to incorrect W-2s and 1099-NECs. Your employees and contractors will be left unhappy with these mistakes, and the IRS may issue you a penalty.

Avoid these unnecessary burdens by:

• Verifying employee information before your W-2 and 1099 deadlines.
• Review payroll records to ensure all pre- and post-tax deductions are correct.
• Check payroll for accurate recordings of bonuses, overtime and wages.
• Verify that your contractor payments are correct and determine who should receive a 1099-NEC.
• Update all deductions and benefits.

Payroll mistakes eat into your time during tax season and are easier to fix before January than after it.

4. Check Outstanding Invoices and Improve Cash Collection

You might prefer to defer income, but you might also want to maximize it. Over 55% of B2B invoiced sales are overdue and 64% of customer invoices are past due. Waiting for payment is part of business, but you can do a few things to speed it up:

• Automate your invoicing to send invoices immediately after goods are sold or services are rendered. You may even be able to invoice upfront depending on your industry.
• Update your invoices to charge a late fee for any invoices that remain overdue for too long.
• Create an invoice reminder system that urges payment without eating into your employees’ time every week.

Improving your cash collection ensures healthier cash flow for your business going into a New Year.

5. Plan for 2026: Budgeting, Forecasting and Goal Setting

You have a big year ahead of you. Plan for it. Use your financial statements to:

• Forecast your finances for the upcoming year.
• Budget for the year ahead and the changes you hope to make.
• Set realistic goals that you and your team can strive to achieve in 2026.

Goal setting using your financial statements for the year will allow you to create the milestones you need to reach throughout the year to hit them. Small steps can lead to big changes in the year ahead.

6. Meet With Your Accountant Before December 31st

Your accountant will guide your business forward in 2026. Meet with your accountant before the year’s end to review your finances and make smart business decisions to save on taxes and go into the year strong.

If you have plans to meet your accountant after the 1st of the year, reschedule to an earlier date.

Add all of these points to your year end bookkeeping checklist, and you’ll be on a good footing to start the year. 

To learn more about creating a year-end financial checklist or how we can help you with your bookkeeping and accounting needs, schedule a consultation now!