Finalizing Year-End Processes for Your Business
As the leaves fall and stores begin playing holiday music, our minds quickly transition to payroll and bookkeeping year-end processes. Okay, so maybe that’s not quite how it goes. Even so, as 2023 comes to a close and we prepare for 2024, it’s especially important to finalize year-end processes for your business that will also be carried into January of 2024.
Here are several processes you’ll want to complete by the end of December and January:
1) Clean Books
Although every business is required to have accurate financial records at tax time, staying on top of your records throughout the year is critical to the efficiency and productivity of your business. This can include income statements, balance sheets, reconciling your bank accounts, and much more. (Click here for more info about keeping clean books.)
2) PTE Payment
As of February 2023, certain pass-through entities can voluntarily elect to pay tax at the entity level. This is based on each business owner’s total share of adjusted gross income. (Click here for more info about paying PTE taxes.)
3) Asset Purchases
Own a business? Consider making an asset purchase before the end of the year in order to reduce your tax liability.
4) Medical Insurance for S – Corporations
The IRS allows S-Corporations to pay health and accident insurance for 2% stakeholders. However, these premiums must be treated as income for the stakeholder. Please update your payroll provider on any employees meeting this criterion. You will need to enter this information prior to December 31, 2023 for it to be included on the W-2. (Click here for more info about tax law.)
5) INTIME Review
The Indiana Department of Revenue has an online portal called INTIME (Indiana Taxpayer Information Management Engine) for customers to manage sales tax, withholdings, and corporate income tax. You will want to know how to access this portal to review communications, review past tax filings, and to file/pay new tax filings. (Click here for more info about setting up your INTIME account.)
1) Clean Books
Finalize your book cleanup as you prepare to complete your tax return. (Click here for more info about keeping clean books.)
2) 1099 Process
If you made a payment during the calendar year as a small business or self-employed (individual), you are most likely required to file an information return to the IRS. Business owners must issue a 1099 for each person they paid at least $600 in rent, services, prizes and awards, or other income payments to. 1099s must be submitted to the IRS by January 31st and may be filed either electronically or by mail. (Click here for more info about filing 1099s.)
3) W-2 Process
Prior to December 31, you will want to confirm the payroll information for all employees. Verify the spelling of names, social security numbers, street addresses and email addresses. You also need to ensure that all bonuses and wages are processed. If there are any corrections needed, please notify your payroll provider. This will ensure that employees receive correct W-2s in a timely fashion.
4) Unemployment Tax Rate Changes
Each year, the Department of Workforce Development (DWD) adjusts the unemployment rate for businesses. You will receive a letter from the DWD defining the new rate. Please send a copy of the notice to your payroll provider to update their system.
Although this seems like a great deal of work to get done by December and January, don’t stress. Our Business Services Team is here to support you. We provide year-round consultation and education for every business need, so that you can have peace of mind as we guide you through each step. We’ll get you back to raking leaves and listening to holiday music in no time!
Feel free to contact us if you have any questions or would like to set up a consultation with our Business Services Team. Click here for contact information. Or click here to learn more about our Business Services.