Tax season may still feel months away, but if your business bookkeeping needs some attention, waiting until January to deal with it can create unnecessary stress.

The best time to start a bookkeeping cleanup is before tax season is right around the corner. Ideally, business owners should begin reviewing and cleaning up their books in the fall—giving themselves enough time to identify problems, make corrections, and get their financial records in order before year-end.

If you've fallen behind on your bookkeeping this year, now is a great time to catch up.

What Exactly Is a Bookkeeping Cleanup?

A bookkeeping cleanup is more than simply categorizing a few transactions you haven't gotten around to.

Depending on the condition of your books, a cleanup may include:

• Reviewing and properly categorizing transactions

• Reconciling bank and credit card accounts

• Identifying duplicate or missing transactions

• Reviewing outstanding accounts receivable or accounts payable

• Correcting bookkeeping errors

• Reviewing balance sheet accounts for accuracy

• Making sure your financial reports reflect what is actually happening in your business

The goal is to get your books to a place where your financial information is complete, organized, and useful.

Why You Don't Want to Wait Until Tax Season

It's common for business owners to put bookkeeping on the back burner. You're focused on serving clients, generating revenue, managing employees, marketing your business, and handling everything else that comes with being a business owner.

Then tax season arrives, and suddenly the books need to be cleaned up quickly.

The problem is that bookkeeping cleanups can take time—especially when several months of transactions need to be reviewed or when accounts haven't been reconciled.

Starting earlier gives you time to answer questions, locate missing information, resolve discrepancies, and make corrections without the pressure of an approaching tax deadline.

It can also make things much easier when it's time to provide financial information to your tax professional.

Your Books Aren't Just for Tax Season

There's another important reason not to wait until tax time: your bookkeeping should help you manage your business throughout the year.

When your books are several months behind, you may not have an accurate picture of:

• How profitable your business really is

• Where your money is being spent

• Whether expenses are increasing

• How much cash your business has available

• Which areas of the business may need your attention

Clean, current books allow you to use your financial reports to make informed business decisions—not simply prepare for taxes.

That's why a bookkeeping cleanup can be a great starting point, but it doesn't have to be the end goal.

Once your books are cleaned up, keeping them current each month can prevent you from finding yourself in the same position next year.

So, When Should You Start?

If you already know your bookkeeping is behind, the best time to start is before the year ends.

You don't need to wait until December 31—or until your tax professional asks for your financials.

Starting in the fall gives you an opportunity to get caught up, review where your business stands financially, and head into the new year with cleaner books and better information.

And if you're not sure whether your books actually need a cleanup, that's okay too. A review of your bookkeeping can help identify what needs attention and what may already be in good shape.

Don't Carry Messy Books into Another Year

If you've been telling yourself, “I'll deal with the books later,” consider this your reminder that later doesn't have to mean tax season.

Getting ahead of your bookkeeping now can mean fewer surprises, less scrambling, and more confidence in the numbers you're using to run your business.

Ready to find out what condition your books are in before tax season? Schedule a bookkeeping cleanup consultation today and let's get your books ready for year-end—and keep them that way going forward.

Contact us today to learn how we can help your business thrive!