A year-end bookkeeping checklist works best when it starts in Q3, not December. The businesses that sail through January begin now: collecting W-9s, listing fixed assets, planning the inventory count, cleaning up the books, and booking their CPA before calendars fill. This guide is the early-start list, with the new 1099 threshold as the reason to begin this week.
Year-end is not a date; it is a pipeline. Everything on this list is quick in August, annoying in November, and expensive in January. So the play is simple: pull the easy work forward.
The year-end bookkeeping checklist, Q3 edition
1. Collect W-9s from every contractor, now
January’s 1099 scramble is really a W-9 problem. You cannot file forms for people whose tax details you never collected. Also, contractors get slower to respond once the work is done. Meanwhile, the rules changed. For payments made in 2026, the federal reporting threshold rose to $2,000, up from the long-standing $600. Our $2,000 rule guide covers the details. Best practice is unchanged though: collect a W-9 from every contractor at onboarding, regardless of amount. In August, you never know who crosses the line by December.
2. Reconcile hard, through the most recent month
Specifically: every bank, credit card, and loan account, reconciled and current. Uncategorized transactions at year-end become guesses on a tax return. If reconciliations are months behind, this is the single most valuable item on the list, and our cleanup guide shows what catching up involves.
3. Build the fixed-asset and loan list
Anything sizable you bought this year, with dates, amounts, and invoices: equipment, vehicles, computers, improvements. Add year-end loan statements as they arrive. Your CPA needs this list for depreciation decisions. Assembling it from memory in February is as fun as it sounds.
4. Plan the inventory count
Product businesses need a physical count near December 31. A clean count needs planning: who counts, when, and how the number gets into the books. So decide in Q3, calendar it, and the count becomes routine. Our ecommerce bookkeeping guide explains why the inventory figure drives your entire margin picture.
5. Review owner draws and loans to shareholders
Money that moved between you and the business needs clean categorization before year-end. That means draws, contributions, and anything sitting in a loan account. Indeed, these are the entries CPAs ask about most, and the answers are much easier to reconstruct in September than in March.
6. Book your CPA and agree on the handoff date
Good tax preparers fill their calendars early. So schedule the handoff: books closed by a date you both pick, delivered as a reconciled file rather than a shoebox. If you do not have a CPA yet, Q3 is hiring season; by January, the good ones are gone.
Why the $2,000 threshold does not mean less work
A higher reporting threshold sounds like fewer forms, and for many businesses it will be. But you only know who crossed $2,000 if the books track contractor payments by payee all year. Every payment method counts. Card payments and payment apps also follow their own separate reporting rules through the processors. So the bookkeeping discipline is identical to the $600 era: complete records, W-9s on file, and totals you trust. In short, the threshold changes who gets a form in January, not how you keep the books in August.
What this buys you in January
Run this list in Q3 and year-end becomes mechanical. The count happens on schedule, and 1099s go out from totals you already trust. Meanwhile, the CPA receives a file with zero open questions. Skip it, and each undone item returns with interest. January is the month when every bookkeeper, CPA, and owner is busiest.
How Books LA handles this
For our monthly clients, most of this list is simply how the books already run. Accounts stay reconciled, contractor payments stay tracked, and the CPA handoff happens on an agreed date. The Q3 additions, W-9 sweeps and count planning, get flagged in our client reviews. Details on our services page.
Frequently asked questions
When should year-end prep actually start?
Now, meaning Q3. The tasks themselves are small; their difficulty comes entirely from timing. W-9 collection, asset lists, and cleanup all get harder as the year closes and everyone’s availability shrinks.
Do I still need W-9s under the $2,000 threshold?
Yes. You cannot know in advance which contractors will cross the threshold by December, and states can have their own rules. Collecting a W-9 at onboarding, every time, costs nothing and removes the January chase entirely.
What if my books are months behind right now?
Then catch-up is your entire Q3 list, and it is the best-timed cleanup of the year. There is runway to finish calmly, and every downstream task gets easier. A focused cleanup now also surfaces missing documents while vendors can still resend them.
What does my CPA actually need from me at year-end?
A reconciled file, the fixed-asset list with invoices, and year-end statements for every account and loan. Add the inventory figure if you carry stock, plus clean owner-transaction records. Deliver those and most CPA questions disappear before they are asked.
Do payment apps and card payments go on 1099s I file?
Generally, the processors report card and platform payments under their own rules. Your direct payments by check, cash, or bank transfer belong on your forms. The split is exactly why payment-method detail in the books matters. Confirm specifics with your CPA.
What is the single highest-value item on this list?
Reconciliation. Every other item builds on it, so if you do one thing in Q3, close the gap between today’s date and your last reconciled month.
If you would rather hand this list to someone who does it every year, book a short call with Books LA.
This article is general information, not tax advice. Books LA provides bookkeeping services and does not provide income tax advice; we work with our clients’ CPAs on income tax matters. Confirm 1099 obligations and thresholds for your situation with your CPA or the IRS.
