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How do I prepare my books for my CPA?

Your CPA needs books they can trust. That means reconciled accounts, properly categorized transactions, and documentation that supports what your records show. The more complete your books are, the less time your CPA spends asking questions and the lower your bill tends to be.

Reconcile every bank account and credit card through December 31st. This is the foundation. If your bank balance in QuickBooks doesn’t match your actual bank statement, nothing else matters until that’s fixed. Reconciliation catches missing transactions, duplicates, and errors that would otherwise flow through to your tax return.

Clear out uncategorized transactions and anything sitting in “Ask My Accountant” or similar holding accounts. Your CPA shouldn’t have to guess what a $1,200 charge at Home Depot was for. If you don’t know either, figure it out now while you can still look it up or remember. Every unclear transaction delays the process.

Make sure owner draws are recorded as draws, not expenses. Taking money out of the business for personal use is not a tax deduction. If you’ve been categorizing personal withdrawals as miscellaneous expense or something similar, fix that before your CPA sees it. Same goes for personal expenses paid with business funds.

Document major asset purchases separately. If you bought equipment, a vehicle, or made improvements to property, your CPA needs the purchase date, amount, and what it was. These get depreciated differently than regular expenses and can significantly affect your tax situation.

Review your accounts receivable and accounts payable. Write off invoices you’re never going to collect. Clear out old bills that have been paid but not recorded. Your balance sheet should reflect reality, not what was true eight months ago.

If you have employees, make sure payroll records are complete and W-2s are ready to go. Your CPA needs total wages paid, taxes withheld, and employer tax payments made. Payroll mistakes are common and expensive to fix after the fact.

Pull together supporting documents your CPA might request. This includes contracts for large purchases, loan documents, lease agreements, and receipts for anything that might get questioned. You don’t necessarily need to send all of this upfront, but having it organized saves scrambling later.

Note anything unusual that happened during the year. Did you start a new business activity? Sell equipment? Take on a partner? Receive an insurance settlement? These things affect your return and your CPA needs to know about them even if they don’t show up clearly in the books.

If your books are behind or you’re not confident they’re accurate, consider catch-up bookkeeping before tax season. Handing your CPA a shoebox of receipts or a QuickBooks file full of errors means they’re doing bookkeeping at CPA rates, which gets expensive quickly.

The goal is giving your CPA clean numbers they can work from without second-guessing everything. Professional bookkeeping services Santa Fe NM businesses rely on throughout the year make tax preparation straightforward because the books are already in shape when January arrives. If you’re doing it yourself, setting aside time in early January to review and clean up before your CPA appointment prevents the rush and missed deductions that come from last-minute preparation.

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More Questions

How do I catch up on months of bookkeeping?

Start by gathering bank statements, credit card statements, and receipts for every month you're behind. Work chronologically from the oldest month forward, reconciling each account before moving on. The time investment grows quickly beyond a few months.

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Should I hire a bookkeeper for my vacation rental business?

If you manage multiple properties or find yourself spending hours each month sorting through platform payouts, a bookkeeper is worth considering. The complexity of tracking revenue by property, reconciling different platforms, and handling New Mexico's Gross Receipts Tax usually exceeds what most owners want to manage themselves.

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What documents do I need to catch up my books?

Bank statements are the essential foundation for any catch-up project. Add credit card statements, payment processor records, and whatever invoices or receipts you have. Missing some documents shouldn't stop you from getting started.

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What chart of accounts should a trucking company use?

A trucking company chart of accounts should separate fixed costs from variable costs and track expenses in ways that let you calculate cost per mile. Generic setups don't give you useful information about where money actually goes.

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How do I track supplies and amenities for vacation rentals?

Track vacation rental supplies by creating specific expense categories in your accounting software and coding every purchase to the correct property. The goal is understanding your true cost per guest stay, not just having receipts for tax time.

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Should I use QuickBooks or property management software?

Property management software handles operations like tenant tracking and rent collection. QuickBooks handles actual accounting and financial reporting. Many property managers use both, with PM software syncing to QuickBooks for clean books.

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Focus Point Accounting provides bookkeeping and accounting services for small businesses across Santa Fe and Northern New Mexico. Led by Stephen Vigil, a Certified Internal Auditor with 20+ years of experience. We bring an auditor's precision to your financial records.

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