Year-End Bookkeeping Checklist
A year-end checklist for Lexington small businesses covering reconciliations, payroll, sales tax, local occupational license records, financial reports, and tax-prep handoff.
This resource is educational and is not tax, payroll, or legal advice. Confirm filing requirements and deadlines with the relevant agencies or a qualified professional.
Short answer
At year end, Lexington businesses should reconcile bank and credit card accounts, review payroll and sales tax records, confirm local occupational license filings, prepare P&L and balance sheet reports, and send clean records to the tax preparer early.
Checklist
- Reconcile every bank, credit card, loan, and payroll account.
- Review uncategorized transactions, owner draws, loans, and fixed assets.
- Compare payroll provider reports to QuickBooks and local withholding filings.
- Review Kentucky sales tax payable and filing confirmations if sales tax applies.
- Confirm Lexington net profit, annual minimum fee, and withholding records are ready.
- Send P&L, balance sheet, payroll reports, sales tax records, and city filing confirmations to the tax preparer.
Common mistakes
- Preparing tax records from unreconciled bank feeds.
- Forgetting local Lexington occupational license records.
- Treating collected sales tax or payroll withholding as normal income.
- Waiting until the tax preparer asks for reports to clean up the books.
Examples for service businesses
- A Lexington contractor should review job deposits, subcontractors, materials, payroll, and local tax records before year end.
- A landscaping business should compare payroll reports, equipment purchases, fuel, repairs, and sales tax activity.
- A retail business should reconcile merchant deposits and sales tax payable before sending reports to the tax preparer.
Start with reconciliations
Year-end work starts with proof that the books match reality. Reconcile bank accounts, credit cards, loans, merchant deposits, payroll clearing accounts, and any tax liability accounts before reviewing profit.
If accounts are not reconciled, the profit and loss may be missing expenses, duplicate payments, or unrecorded deposits.
Review payroll, sales tax, and local tax accounts
For employers, compare payroll provider reports to QuickBooks and to Lexington withholding filings. Lexington says employer withholding returns are filed quarterly, or monthly if total withholdings in any quarter exceed $300.
For taxable sellers or service providers, review Kentucky sales tax payable and filing confirmations. Collected sales tax should not sit in income at year end.
Confirm Lexington occupational license records
Lexington's current guidance says every business entity must file the Net Profits License Fee Return annually unless it has an IRS tax-exempt determination letter. The city also lists a $100 annual minimum license fee paid with the Net Profits License Fee Return.
Keep the annual local return, estimated payments, minimum fee records, and any payroll withholding filings with the tax-prep packet.
Prepare the tax-prep handoff
A clean handoff usually includes the year-end profit and loss, balance sheet, general ledger if requested, payroll reports, 1099 vendor list, sales tax filing confirmations, loan statements, asset purchases, owner contributions, and owner draws.
Send explanations for unusual transactions while they are still fresh. A short note in December can prevent a long cleanup project in March or April.
Clean Up Before Tax Season
If your year-end books are behind, Sabillon Advisory can help clean up transactions, reconcile accounts, and prepare reports before your tax preparer starts asking questions.
Clean Up Before Tax SeasonRelated resources
Tax Season Bookkeeping Checklist
Use a broader year-end cleanup process.
Monthly Bookkeeping Checklist
Make year-end easier with monthly habits.
Lexington Business License Guide
Review local license and occupational tax basics.
Lexington Payroll Withholding Guide
Reconcile local payroll withholding before year end.
Kentucky Sales Tax in QuickBooks Online
Review QBO sales tax liability before filing.
Related support from Sabillon Advisory
If this guide describes the bookkeeping problem you are dealing with, these services are the most relevant next step.