Now is the Time to Post Year-End Journal Entries
The end of 2020 is quickly approaching (thankfully). Now is the time to confirm that you have posted the adjusting journal entries that were given to you by your tax preparer with your 2019 corporate tax return in your QuickBooks file. These adjusting entries will bring your books into alignment with your tax return balances as determined with your last year’s tax return. Once the journal entries have been posted, it is also helpful to reconcile the general ledger account balances and total trial balance as of your fiscal year-end in QuickBooks with the trial balance provided by your tax preparer to verify the entries were posted correctly.
There is one common issue that occurs that sometimes requires additional work. If your tax preparer creates a new general ledger account which is used in a journal entry that will need to be set up in your QuickBooks file. Understanding the different general ledger types and how to create new accounts in QuickBooks can often be a stumbling block if you have minimal accounting experience.
If these journal entries are not posted prior to the preparation of your 2020 corporate tax return, this could cause additional accounting assistance work by your tax preparer in order to begin the 2020 tax preparation. More time by your tax preparer translates to more dollars out of your pocket. Therefore, it is important to get these journal entries posted before year-end.
Should you need any assistance with posting these journal entries to your QuickBooks file and reconciling your trial balance, please reach out to our RAD team in Williston (802.878.1963) or Rutland (802.775.7132), and one of our qualified staff will be happy to help.
Written by Martha Leonard, Bookkeeper, RAD