A Practical Year-End Tax Preparation Checklist

Start by identifying anything that changed during 2026.

Examples include:

• Starting or closing a business
• Changing jobs
• Moving to or from Virginia
• Getting married or divorced
• Welcoming a child
• Buying or selling a home
• Beginning freelance or rental activity
• Hiring employees or contractors
• Purchasing business equipment
• Receiving investment, retirement, or cryptocurrency income

These changes may affect your deductions, tax credits, filing status, estimated payments, or reporting requirements.

Business owners should record all income and expenses through December 31.

Review your financial reports for:

• Missing or duplicated transactions
• Uncategorized expenses
• Personal purchases paid from the business account
• Business expenses paid personally
• Incorrect loan or credit-card balances
• Unpaid customer invoices
• Outstanding vendor bills

Your profit and loss statement, balance sheet, bank accounts, and supporting records should all reflect the same financial activity.

Reconcile every business account against its final statement of the year.

Include:

• Checking and savings accounts
• Credit cards
• Business loans
• Payroll accounts
• PayPal, Stripe, Square, Venmo, and similar platforms

Payment processors often deduct fees, refunds, or disputes before transferring money to your bank. Recording only the deposited amount may understate both your income and your business expenses.

Do not rely only on the tax forms you receive in January.

Review income from:

• Employment
• Self-employment
• Contract work
• Rental properties
• Investments
• Retirement distributions
• Online marketplaces
• Digital assets
• Payment applications
• Interest and dividends

Income may still need to be reported even when you do not receive a Form 1099.

Verify that you have a completed Form W-9 for each independent contractor who may require a tax form.

Confirm their:

• Legal name
• Business name
• Address
• Taxpayer identification number
• Total payments received

Employers should also review employee names, Social Security numbers, addresses, wages, withholding, bonuses, benefits, and retirement contributions before preparing Forms W-2.

Correcting payroll information before year-end is usually easier than amending tax forms later.

Compare your expected tax liability with the federal and Virginia taxes already paid through withholding or quarterly estimated payments.

This is especially important for:

• Self-employed individuals
• Business owners
• Landlords
• Investors
• Retirees
• Households with multiple sources of income

The final estimated payment for the 2026 tax year is generally due in January 2027.

A year-end tax projection can help you prepare for a possible balance due and reduce the risk of underpayment penalties.

Gather documents related to deductions and tax credits, including:

• Mortgage interest
• Real-estate taxes
• Charitable contributions
• Childcare expenses
• Education costs
• Medical expenses
• Health-insurance records
• Retirement contributions
• Home or business energy improvements
• Business mileage and travel
• Equipment and technology purchases

Keep receipts, invoices, mileage logs, contracts, and written explanations of the business purpose behind significant expenses.

A bank statement confirms that a payment occurred, but it may not fully explain what was purchased or why it was deductible.

Prepare a list of business equipment purchased, sold, traded, or discarded during 2026.

Include:

• Computers
• Furniture
• Vehicles
• Machinery
• Cameras or professional equipment
• Office technology
• Tools

Record the purchase date, cost, financing details, business-use percentage, and the date the asset was placed into service.

Businesses with inventory should also complete an accurate year-end inventory count.

Virginia Beach businesses should place local filing deadlines on their calendars before the year closes.

Depending on the business, this may include:

• Annual business-license renewal
• Business tangible personal property reporting
• Updates to equipment and asset listings
• Changes in business location or ownership
• Local tax accounts and registrations

Business property may still need to be reported locally even when it has already been fully depreciated for federal tax purposes.

Create one organized folder for the 2026 tax year.

Suggested sections include:

• Income documents
• Business financial statements
• Bank and credit-card records
• Payroll
• Contractors
• Estimated tax payments
• Assets and vehicles
• Deductions
• Virginia tax documents
• Virginia Beach filings
• Tax notices

Use clear file names and avoid sending sensitive information through regular, unencrypted email whenever a secure client portal is available.

A smoother tax season starts with accurate records.

Before the end of the year, make sure your bookkeeping is current, financial accounts are reconciled, payroll information is correct, contractor records are complete, and important tax documents are organized.

Susy Ivy Accounting helps individuals, entrepreneurs, and small businesses in Virginia Beach prepare their financial records, manage bookkeeping and payroll, and approach tax season with greater clarity and confidence.