How to Get Your Books Ready for Tax Season—Even If You’re Behind
Gather your business receipts for tax preparation
For many small business owners, tax season feels a little like a surprise party you didn’t want and didn’t ask for. You know it’s coming every year, yet somehow it still sneaks up fast. One minute it’s summer, and the next thing you know, your CPA is emailing you asking for reports you forgot existed.
If your bookkeeping isn’t caught up — or if it’s not as organized as you’d like — the good news is this:
It’s absolutely possible to get tax-ready, even if you’re months behind.
Whether your books are slightly messy, halfway done, or living entirely in receipts stuffed inside a kitchen drawer, this guide walks you through how to get everything in order so your CPA can file accurately, on time, and without extra stress.
Let’s make tax prep simpler and more manageable — one step at a time.
Why Tax Season Feels Overwhelming (and How to Fix It)
Business owners don’t struggle because taxes are complicated.
They struggle because:
Important documents are scattered
Transactions aren’t categorized
Books aren’t reconciled
Income totals don’t match deposits
Expenses were never logged
Contractor totals weren’t tracked
W-9s weren’t collected
Everything was left until the last minute
Once you understand what your CPA actually needs, the process becomes much easier.
Here’s your step-by-step checklist to get fully tax-ready — even if you're starting late.
Step 1: Gather All Your Financial Statements
Before you touch your bookkeeping software, gather the documents that feed into it.
You’ll need:
Bank statements
For every business account.
Credit card statements
Even if you only used it for a few expenses.
Loan statements
SBA loans, business loans, line of credit statements, equipment financing — anything related to your business.
Payment processor reports
PayPal, Stripe, Square, Venmo (business), Zelle, Etsy, Shopify, etc.
Payroll reports
If you run payroll, grab:
Annual payroll summary
Quarterly reports
W-2/W-3 forms
941/944 filings
Mileage records (if applicable)
Receipts
Paper, digital, screenshots — everything counts.
Once these are gathered in one place, tax prep becomes much easier.
Step 2: Categorize Every Transaction
Now it’s time to update your books.
If bookkeeping isn’t your favorite task, here’s the good news: this doesn’t have to be perfect. It just needs to be accurate enough for your tax preparer to understand what happened throughout the year.
Why categorizing matters:
Helps your CPA identify eligible tax deductions
Ensures income is reported correctly
Creates accurate financial statements
Reduces CPA cleanup fees
Prevents reporting mistakes
Common categories include:
Advertising & marketing
Meals (business-related)
Supplies
Software & subscriptions
Contract labor
Professional services
Rent or home office deductions
Equipment
Travel
Utilities
Income
Refunds
Owner draws & contributions
If you’re unsure where something belongs, create a “Questions” category and let your bookkeeper or CPA review it later.
Step 3: Reconcile All Accounts
Reconciliation is one of the most important steps of getting tax-ready — but it’s also the step most business owners skip.
What reconciliation does:
Reconciliation compares your bookkeeping records with your bank/credit card statements to confirm they match.
Why it matters:
Catches missing transactions
Catches duplicate transactions
Prevents false income totals
Prevents wrong expense totals
Protects from fraud
Ensures accurate tax reporting
Even a single unreconciled month can throw off your entire year.
If you’ve been behind, focus on reconciling each month starting in January and move forward through the year. If reconciliation is overwhelming, this is a perfect task to outsource — bookkeepers handle it quickly.
Step 4: Review Contractor Payments (1099s)
This step is often misunderstood, but it’s critical for tax compliance.
Which contractors need a 1099?
Anyone you paid $600 or more during the year for business services (not goods).
To issue a 1099, you must have:
A completed W-9
Contractor’s legal name
Address
EIN or SSN
Total amount paid
If you paid someone without collecting a W-9 first, now is the time to request it.
Why this matters:
Missing 1099s can cause IRS red flags. A bookkeeper can track your contractor payments all year so this is easy next year.
Step 5: Organize Your Receipts (Without Overthinking It)
You do NOT need perfect organization. You simply need proof of business use.
The easiest method:
Create one digital folder called “2025 Receipts – Business.” Then drag:
Screenshots
Photos
PDF invoices
Emailed receipts
Digital statements
…into that folder.
That’s enough for your CPA and the IRS if you’re ever audited. Apps like QuickBooks, Dext, or Shoeboxed can help — but are optional.
Step 6: Check for Missing or Duplicate Transactions
Once your books are categorized and reconciled, run a quick review.
Look for:
Deposits that look unfamiliar
Expenses with missing vendor names
Transactions categorized as “ask my accountant”
Transfers counted as income
Duplicate charges
Personal purchases accidentally included
This step ensures your income and expenses are accurate.
Step 7: Prepare the Reports Your CPA Actually Needs
Most CPAs ask for the same standard documents every year.
Here’s what to prepare:
✔ Profit & Loss Statement
Shows income and expenses for the year.
✔ Balance Sheet
Shows assets, liabilities, and equity.
✔ General Ledger
A detailed list of all transactions.
✔ Trial Balance
Internal accuracy check.
✔ Expense reports or summaries
Helpful for tax planning.
✔ Contractor totals (for 1099s)
✔ Mileage or home-office documentation
If applicable.
A bookkeeper can generate everything in minutes once your books are up to date.
Bonus Step: Run a Quick Year-in-Review Check
This step isn’t required, but it’s incredibly helpful. Ask yourself:
Did your revenue come from where you expected?
Which expenses increased or decreased?
Did you hit your financial goals?
Do you need to adjust pricing next year?
Is your bookkeeping system working for you?
Reviewing your numbers helps you make smarter decisions — and prevents next year’s tax season from feeling chaotic again.
What If You’re Really Behind?
You’re not alone — many business owners fall 3, 6, or even 12+ months behind. You have two options:
Option 1: Catch up slowly on your own
Break the year into chunks. Do one month at a time. Chip away until it’s done.
Option 2: Hire help and get caught up fast
A bookkeeper can:
Complete your categorizing
Perform all reconciliations
Organize your receipts
Prepare reports
Fix errors
Make your books tax-ready
What takes you 20 hours can take a bookkeeper 2–4 hours.
The Real Cost of Going Into Tax Season Unprepared
When you go into tax season with messy or incomplete books, you risk:
Overpaying taxes
Missing deductions
Receiving inaccurate tax reports
Needing costly CPA cleanup
Filing delays
Penalties
IRS notices
Clean books = clean taxes.
FAQs About Getting Tax Ready
Q: How far behind is “too far behind”?
You can always catch up. Even years behind can be fixed.
Q: Do I need to categorize every single transaction?
Yes — but it can be done quickly with the right help.
Q: Do I need physical receipts if I have bank statements?
For IRS purposes, yes — you need proof of purchase and business purpose.
Q: Should I wait until everything is perfect before giving it to my CPA?
No. Give them as much as you have. They can help clarify what’s missing.
You Don’t Need to Do Tax Prep Alone
If tax season is approaching and your books aren’t ready, you don’t have to scramble or stress.
Whether you need:
A cleanup
A full catch-up
help organizing receipts
Monthly bookkeeping
Or just a fresh start
I can help you get tax-ready quickly and judgment-free. Send me a message anytime, and I’ll help make sure this tax season is your easiest one yet.