Year-End Bookkeeping Checklist for Small Businesses: What to Gather and Record Before Closing Out 2025

I know you’re probably feeling a bit overwhelmed right now. Here we are on December 31st, and you’re thinking about all the financial records you need to gather before closing out 2025. Trust me, I’ve been helping small business owners through this process for years, and I understand that year-end bookkeeping can feel like climbing a mountain.

But here’s the thing – when you break it down into manageable steps, it becomes much less intimidating. We can work through this together, and by the time you’re done, you’ll have a crystal-clear picture of your business’s financial health heading into 2026.

Essential Financial Statements to Collect

The first step is gathering all your December statements. I always tell my clients to think of this like collecting puzzle pieces – each statement gives us part of the bigger financial picture.

Bank Account Statements
You’ll need December statements for every business bank account you have. This includes:

• Checking accounts
• Savings accounts
• Money market accounts
• Any other deposit accounts tied to your business

Don’t forget to grab your final account balances as of December 31, 2025. This is especially critical if you’re planning to switch accountants or bookkeepers in the new year. Your new financial professional will need these exact balances to ensure a smooth transition.

Credit Card Statements
Collect December statements for all business credit cards, including:

• Primary business credit cards
• Secondary cards for employees
• Store credit cards (Home Depot, Office Depot, etc.)
• Any personal cards used for business expenses

Loan Statements
Gather year-end statements for all business loans:

• Equipment loans
• Vehicle loans
• Lines of credit
• SBA loans
• Any other business debt

Investment and Retirement Account Statements
If your business has any investment accounts, you’ll need December statements for:

• Business investment accounts
• SEP-IRA or other business retirement plans
• CDs or other investment vehicles

Physical Inventory Count: Your Year-End Snapshot

If your business carries inventory, this is one of the most important tasks on your checklist. I know it sounds tedious, but a physical inventory count gives you the true value of what you own at year-end.

Here’s what you need to do:

• Count every item you have in stock as of December 31, 2025
• Record quantities accurately
• Note the condition of items (new, used, damaged)
• Value your inventory at cost or market value, whichever is lower

This physical count often reveals discrepancies from what your computer system shows. Maybe you’ve had shrinkage, damaged goods, or data entry errors throughout the year. Finding these now helps you adjust your records accurately for tax purposes.

Vehicle Mileage Records: Don’t Miss This Deduction

For every company vehicle, you need to record the ending mileage as of December 31, 2025. This includes:

• Company-owned vehicles
• Personal vehicles used for business
• Leased vehicles

Write down the exact odometer reading and keep a photo of it for your records. If you’ve been tracking business miles throughout the year, this ending mileage helps calculate your total business miles for 2025.

Additional Financial Records for a Complete Picture

Beyond the basic statements, there are several other documents that paint a complete picture of your financial situation:

Accounts Receivable Aging Report
Run a report showing who owes you money and how long those invoices have been outstanding. This helps you:

• Identify collection issues
• Determine bad debts to write off
• Plan cash flow for early 2026

Accounts Payable Summary
List all outstanding bills and vendor payments due. Include:

• Regular vendor invoices
• Utility bills
• Rent or lease payments
• Any other business expenses incurred in 2025 but not yet paid

Payroll Records
Gather year-end payroll information including:

• Final payroll for 2025
• Unused vacation or PTO balances
• Year-to-date wage summaries
• Payroll tax deposits made

Asset Lists
Create or update lists of business assets purchased in 2025:

• Equipment and machinery
• Furniture and fixtures
• Computer hardware and software
• Vehicles

1099 Contractor Information
If you paid any contractors or service providers $600 or more in 2025, you’ll need their information for 1099 forms:

• Full legal names and addresses
• Tax ID numbers or Social Security numbers
• Total amounts paid

Bank Reconciliations: Your Financial Foundation

Here’s something I always emphasize with clients – your bank reconciliations need to be current through December 31, 2025. I’ve seen too many businesses struggle because they let reconciliations slide during busy seasons.

Make sure every bank account and credit card is reconciled through year-end. If you find discrepancies, investigate them now rather than letting them carry into 2026. Common issues include:

• Outstanding checks that need to be voided
• Bank fees not recorded in your books
• Duplicate transactions
• Deposits in transit

Tax Document Preparation

While you’re gathering everything else, start organizing documents your tax preparer will need:

• All those statements we just collected
• Records of business expenses and receipts
• Equipment purchase invoices and documentation
• Home office expense calculations (if applicable)
• Health insurance premium records
• Professional development and training costs

Creating Your Year-End Financial Snapshot

Once you’ve gathered all these documents, you’ll have everything needed to create accurate year-end financial statements. These include:

• Balance sheet showing assets, liabilities, and equity as of December 31, 2025
• Profit and loss statement for the full year 2025
• Cash flow statement showing money movement

These reports become the foundation for tax preparation and help you make informed business decisions for 2026.

Don’t Forget These Often-Overlooked Items

In my years of helping small businesses, I’ve noticed a few items that frequently get missed:

• Prepaid expenses like insurance premiums or software subscriptions paid in advance
• Accrued expenses for services received but not yet billed
• Equipment depreciation calculations for assets purchased during the year
• Loan principal vs. interest breakdowns for proper expense categorization

When You Need Professional Help

I understand that this checklist might feel overwhelming, especially if you’re already wearing multiple hats in your business. That’s completely normal, and there’s no shame in needing support.

We work with small business owners just like you every day. Whether you need help organizing these year-end records, catching up on bookkeeping, or setting up systems for better financial management in 2026, we’re here to help.

Our team specializes in taking the bookkeeping burden off your shoulders so you can focus on running your business. We offer flexible services tailored to your specific needs – you don’t have to commit to everything at once.

The peace of mind that comes from having organized, accurate financial records is invaluable. When tax season arrives, when you need to make business decisions, or when unexpected opportunities arise, you’ll have the clear financial picture you need.

Ready to Get Organized?

If you’re feeling overwhelmed by this checklist or realize you need help catching up, let’s start with a conversation. We offer a free initial consultation where we can assess your current situation and discuss how we might work together.

You can reach us at our website or simply give us a call. We’ll schedule a meeting that works with your busy schedule, and we’ll go from there. No pressure – just a friendly discussion about how to make your financial management easier and more effective.

Remember, getting your year-end records organized isn’t just about meeting deadlines. It’s about setting your business up for success in 2026 and beyond.