Essential Year-End Bookkeeping Tips for Small Businesses and Trucking Companies

Closing the books at the end of the year can feel overwhelming for small businesses and trucking companies. Yet, a thorough year-end review is crucial to avoid costly mistakes, prepare accurate tax filings, and set a clear financial path for the next year. This guide breaks down key steps to help you check expenses, organize contractor records, and prepare 1099 forms efficiently.

Year-end bookkeeping setup with trucking documents and calculator

Review and Reconcile All Expenses

One of the first tasks in year-end bookkeeping is to review all business expenses carefully. For trucking companies and small businesses, expenses can range from fuel and maintenance to office supplies and subcontractor payments.

• Match receipts to recorded expenses. Ensure every expense in your accounting system has a corresponding receipt or invoice. Missing documentation can cause problems during audits.

• Check for duplicate or incorrect entries. Sometimes expenses get recorded twice or with wrong amounts. Spotting these errors early saves time later.

• Categorize expenses correctly. Proper categorization helps with tax deductions. For example, fuel costs should be separated from vehicle repairs.

• Verify bank and credit card statements. Reconcile these statements with your bookkeeping records to catch any discrepancies.

  
  

By completing this review, you confirm that your financial records reflect the true state of your business spending.

Organize Contractor Records for 1099 Preparation

Many small businesses and trucking companies rely on independent contractors. The IRS requires businesses to issue Form 1099-NEC to contractors paid $600 or more during the year. Preparing these forms accurately depends on well-maintained contractor records.

• Gather W-9 forms from all contractors. These forms provide the legal name and Taxpayer Identification Number (TIN) needed for 1099s.

• Track payments to each contractor. Use your accounting software or spreadsheets to total payments made throughout the year.

• Confirm contractor status. Ensure the workers you classify as contractors are not actually employees, as this affects tax reporting.

• Prepare 1099 forms early. The IRS deadline for sending 1099s to contractors is January 31. Starting early avoids last-minute stress.

  
  

Keeping contractor information organized throughout the year simplifies this process and reduces the risk of errors.

Check Vehicle and Equipment Records

For trucking companies, vehicles and equipment represent significant assets and expenses. Accurate records help with depreciation calculations and tax deductions.

• Review mileage logs. Confirm that mileage is recorded consistently for business use. This supports deductions related to fuel and maintenance.

• Track repairs and maintenance costs. Separate routine maintenance from major repairs to understand your expenses better.

• Update asset lists. Add any new vehicles or equipment purchased during the year and remove those sold or retired.

• Calculate depreciation. Use IRS guidelines or consult a tax professional to apply the correct depreciation method.

  
  

Maintaining detailed vehicle records ensures you maximize deductions and keep your books accurate.

Prepare Financial Statements and Reports

After reviewing expenses and organizing records, generate key financial statements. These reports provide a snapshot of your business’s financial health and are essential for tax filing and planning.

• Profit and loss statement. Shows income, expenses, and net profit or loss for the year.

• Balance sheet. Lists assets, liabilities, and equity at year-end.

• Cash flow statement. Tracks cash inflows and outflows to understand liquidity.

  
  

Review these reports for unusual trends or errors. For example, a sudden spike in expenses might indicate a data entry mistake or an area to investigate.

Plan for Tax Filing and Compliance

Year-end bookkeeping sets the stage for smooth tax filing. Small businesses and trucking companies must comply with various tax rules, including payroll taxes, sales taxes, and income taxes.

• Confirm payroll tax deposits are up to date. Missing payments can lead to penalties.

• Prepare and file 1099 forms. Submit these to contractors and the IRS on time.

• Review estimated tax payments. Adjust your quarterly payments for the coming year based on current year results.

• Consult a tax professional if needed. Complex situations, such as multiple states of operation or new tax laws, may require expert advice.

  
  

Taking these steps reduces the risk of audits and penalties.

Set Up for a Strong New Year

Year-end bookkeeping is not just about closing the books; it’s also about preparing for the year ahead.

• Create a checklist for monthly bookkeeping tasks. Regular updates prevent year-end headaches.

• Invest in bookkeeping software or services. Automation can improve accuracy and save time.

• Train staff on record-keeping best practices. Clear procedures help maintain clean books.

• Review your budget and financial goals. Use insights from your year-end reports to plan growth or cost control.

  
  

A proactive approach to bookkeeping supports better decision-making and business success.