Blog Series: Real Tips from Real Accountants: Year-end is here and planning with your accountant is crucial

This blog series is designed to give you real advice from our team members. They have a true pulse on how elements such as the pandemic, the upcoming election, the economy and tax laws (just to name a few) are affecting business owners. The latest prompt they were asked to respond to is focused on the fact that the end of 2020 is upon us and 2021 is right around the corner.  What can business owners do now to close out the year on a positive note? Read the prompt below and take some notes as your review these detailed responses from our team members.


The end of 2020 is fast approaching. Clearly, this year has presented challenges to business owners of all sizes, across all industries. What should business owners be doing now in Q4 to prepare for year-end?  How can their accountant be of assistance?


Now more than ever, business owners should be keeping their books updated and meeting with their advisors to discuss year-end tax planning. The CARES Act passed back in March, included several tax law changes that business owners should be aware of as they may have a large impact on your tax liability for 2020. Also, if you received a loan from the Small Business Administration under the Paycheck Protection Program, you need to be aware that currently the IRS is not allowing a tax deduction for any expenses paid for with the PPP funds. Due to the many tax law changes and SBA loans resulting from the coronavirus pandemic, you should meet with your accountant during the fourth quarter to discuss your businesses unique situation and how you can best plan for a potentially unexpected tax liability.

Danielle Cottle


2020 has been a very different year for sure.  All the events have certainly impacted our clients in many different ways.  Some areas are having a record year while others are struggling.  As we approach the end of 2020 it’s a good time to review your books and plan.  Make sure all of your PPP reconciliations are complete so when it comes to tax filing we can easily trace the funds.  Also, if you typically pay quarterly estimates and feel your income has changed for 2020 we can prepare a tax projection.  Based on this projection we can adjust your 4th quarter estimates if needed.  Planning now helps prevent surprises in March or April and also gives taxpayers some options before year end.  Start early.

– Brian Davidson


November and December are critical planning months for a lot of our clients. This is a good opportunity to review, with your CPA, how the year went and if there are any opportunities to reduce the tax burden before year-end. For our clients of pass-through entities, corporate year-end projections are important because it helps determine what personal tax liability will be and if other tax planning strategies need to be implemented by year-end.

One item that seems to always be a pain for business owners at year-end/early January, is making sure the financials are clean and correct. This is often pushed to the side and forgotten, causing a rush to get the financials clean right before taxes are due. In November and December, your accountant was more flexibility to help with this, rather than in February and March when tax season is in full swing.

Zac Anderson


Now that we are in the 4th quarter of a challenging year it is still a great time to review 2020 and to project potential tax liabilities even if the impact of COVID has had a negative impact on bottom line income. With tax rates still being low it is a good time to possibly accelerate income this year if possible. Also, capital gain rates are very low if income is low so goo to review if any capital gains should be taken this year.

It is also a good time to review the impact of PPP loan forgiveness if the business has a loan as the application for forgiveness is required by your lender. Even though we do not know whether the loans will be forgiven its is a great time to review any potential impact.

Robert Buckley


Now is the time for reviewing year-end planning with your accountant. With the election fast approaching, it is important to know that there will have consequences regardless who wins.  The Senate outcome, in particular, will be crucial for how tax policy will be impacted for years to come. Now is the time to keep in close contact with your accountant.

Justin Linscott


All business owners should try to get into contact with their chosen financial and tax advisors to discuss projected year-end numbers, year-end tax-planning, and any other decisions (past or upcoming) that could have an effect on the business as we approach the end of the 2020 calendar year. Their accountants and advisors can help steer them in the right direction and can likely offer support and guidance, where needed, through the year-end closing process.-

Jennie Severt


For payroll taxes and W2s, now is a good time to review your year-to-date payroll.  Make sure employee addresses are correct and up-to-date.  Do withholdings make sense based on employees addresses and W4 and IT4 forms?  Remind your employees to review their paystubs for accuracy.  If an employee feels they may be under withheld in taxes, there is still time to make adjustments before the end of the year is here.  Employers, review the payroll taxes you have submitted to the government agencies through the year.  Did you miss anything or submit everything appropriately?

Julie Roe


If a business has not been doing it yet, as the year is winding down, businesses need to evaluate what are the most profitable of their business activities and evaluate how to make them more profitable by better use of technology, smart borrowing, cutting unnecessary expenses and helping employees realize their full potential. Not only will that help them through the pandemic, but it should help them emerged from it even stronger. We can help businesses evaluate their strong suits and help them excel. As this year is winding down, our clients and ourselves need to be thinking about getting through the next few months of winter while dealing with COVID-19. Between what has been termed “COVID fatigue”, colder weather, and what has already been a deemed a major mental health crisis brought on by the pandemic, it is more important than ever that all of us make sure that our employees, friends, family and ourselves are mentally healthy during this trying time. If our clients believe that they or anyone they care about is or could be suffering, please reach out to a mental health professional to find out what can be done.

Mark Rhea


Owners of business’s can benefit is so many ways by meeting with their CPA before the year ends.  My clients know it as “planning season”.  Planning for timing of deductions in the current year is especially important as many businesses received PPP funds that will give rise to potentially more taxable income in 2020 for some.  There are some great opportunities for current deductions in tax law if transactions take place before year end…………………such as purchasing of machinery and equipment………….charitable giving……..and pension planning and related deductions among others.

Bradley Ridge


Get organized!  Start now to gather & sort/separate 2019 documents.  Look back at the type of reports, invoices and figures your accountant requested and was sent in prior years.  Get a head start on pulling those pieces together now, adding to the paper or digital folders as November & December progress.  If you come across any activity that was not typical for your business, reach out to your accountant to discuss – prior to the end of the tax year – to determine if any actions need taken for potential tax benefits.

Tammy Westbrook


As we embark into the 4th Qtr. of 2020, it is time to take proactive action steps that will benefit you for the remainder of 2020 as well as start the vision process for 2021 (and beyond – if you can).  For the remainder of 2020, focus upon what you can control that will contribute to finish the year on a strong and positive note for this incredibly unique pandemic year.  Make sure this positive close-out to 2020 provides positive momentum and energy into 2021.  Now is also a good time to start to formulate your 2021 (and beyond) vision.  The purpose to lay out and document your vision is that it will then allow you to 1) ‘focus on’ what is important;  2) say ‘no’ to what is not important; 3)  monitor and measure the notable markers working toward your vision;  and 4) achieve your stated goals.  Please let any of us at H&M know how we can help you finish 2020 in a positive way as well as help you develop your vision for 2021 (and beyond)

.- Stephen Smith


In Q4 business owners should be double checking their account reconciliations.  There may be certain reconciliations that fell off the radar during the pandemic, but they won’t want to wait until the end of the year to try to catch them up and complete them.  Starting now will make the end of the year wrap up process go much smoother.  Getting caught up with reconciliations should make your yearend forecast more accurate which will help when you reach out to your accountants for year-end tax planning.

A second tip would be to prepare for the 1099 process by making sure that you have all the W-9s from contractors that you will need to accurately complete the 1099s.  Remember if you need help with the preparation and filing of your 1099s you can reach out to your accounts for this service as well.

– Shannon Robinson


All businesses are facing challenges after a tough year with the pandemic. Some industries were affected more than others and should prepare differently for the year end/starting 2021 on a good note. One thing all businesses can do with the assistance of their accounting, is ensuring the books and record keeping is all updated and accurate at the end of 2020. Starting 2021 with accurate numbers will help with planning the new year, including budgeting, forecasting, and areas they can improve. Taking a second look to update Accounts Receivable and the chances that some customers may not be able to pay the full amount owed anymore after COVID should also be considered.

– Nate Duffy


As we head into fourth quarter, and the end of the year, small business owners should be reaching out to their accountants to discuss year-end tax planning.  Discussing these items with their accountants now, allows more adequate time for business decisions to be made, that may impact the tax liability of the company.

Small business owners should also be planning for 2021.  This may include budgeting, setting sales goals, making marketing plans, or reviewing staffing requirements.  By planning for 2021 now, business owners can return to work from the holidays, ready to tackle the year.-

Natalie Bruns


A business owner should start reviewing the financials and records of his or her company to make sure everything has been recorded accurately for 2020. A conversation with his or her accountant in Q4 would be a smart idea in order to ask about potential asset purchases, year-end bonus opportunities, or additional funding of retirement accounts. Accountants also have the ability to run tax projections, so the business owner has a good idea of the tax implications of the company’s activity for the 2020 tax year.

Jennifer Moore


Now is the time to prepare for year-end in order to get a good idea of the year’s performance.  Many businesses have either been extra busy this year, due to new or increased revenue streams; or have been shut down for some time due to COVID restrictions.  Since this year has been so unusual for many of our clients, most are seeing very different results this year, compared to prior years.

Keeping the books up-to-date may have taken a back seat in order to focus on other priorities.

If you just don’t have the time to bring your records up-to-date we can help!  Our staff can assist you with tasks, such as reconciling bank accounts, data entry, recording payroll, etc.

Additionally, if you do have your records up-to-date, would you like Holbrook & Manter to do a quick review to see if there are any issues which need addressed before year-end?  We can also help with projections as they relate to any potential estimated tax payment which would be due before the end of the year.

Linda Lehman


If you do not have a relationship with an accountant that can help you execute the recommendations made in the above responses, please reach out to Holbrook & Manter. We will quickly get in you in touch with the proper team members to help you.