Every January, your CPA sends the same email: “Can you get me your books?” And every January, a lot of contractors suddenly remember QuickBooks exists. They log in for the first time since summer and find seemingly endless uncategorized transactions, a bank account that hasn’t been reconciled for MONTHS, and a mystery loan payment nobody remembers setting up.

Nobody got into contracting because they love bookkeeping. I get it! But January you is going to be extremely grateful to November you.

You don’t have to be that contractor this year! Work through this checklist in November and December, and you’ll hand your CPA clean books instead of a shoebox. You’ll also probably pay less for tax prep, because your CPA won’t be billing you to clean things up first.

1. Reconcile every account. Yes, every account.

Reconciling means matching what’s in QuickBooks to what your bank statement actually says, line by line. It’s the single most important step on this list, because everything else sits on top of it. If the bank balance is wrong, your profit is wrong, and so is your tax bill. No pressure!

Here’s what “every account” really means:

• Every checking and savings account, including the one you opened for that one big job and then completely forgot about.
• Every credit card, including the fuel card and the one your foreman has been carrying since spring.
• Every loan and line of credit. Your truck and equipment balances should match the lender’s year-end statement. If they don’t, the interest and principal split is probably off, and that one quietly wrecks your profit number.

While you’re in there, look for old uncleared checks and deposits that have been sitting for months like they pay rent. They’re usually duplicates or voided checks nobody ever cleaned up.

2. Empty the junk drawer accounts

Every QuickBooks file has a junk drawer. Usually a few: Uncategorized Expense, Uncategorized Income, Ask My Accountant, Opening Balance Equity. That’s where transactions go when nobody knew what to do with them, and the pile grows quietly all year.

Your CPA can’t do much with “uncategorized.” Give every one of those transactions a real home before you send anything over.

While you’re digging, you’ll probably find personal stuff that slipped through on a business card. It happens to absolutely everyone. Yes, that Costco run counts. Move those to owner draws (step 5) instead of leaving them in your expenses, where they’ll make your numbers lie to you all year.

3. Make payroll match the payroll reports

Pull the year-end payroll summary from Gusto, ADP, QuickBooks Payroll, or whoever runs your payroll. Wages, payroll taxes, and benefits in your books should match that report. If you split field crew and office staff into different accounts, check those totals too.

When it doesn’t match, it’s almost always one of three things: a payroll got entered twice, a tax payment got coded as wages, or somebody wrote a manual check and never told anyone. Find it now. Finding it in March, while your CPA is working on the W-2 side of your return, is a much worse day for everyone.

4. Write down everything big you bought

New truck? Trailer? Skid steer? A pile of tools that added up to more than you want to say out loud? Your CPA needs a list of every bigger purchase so they can decide how to write it off. Some things get expensed right away, some get depreciated over several years, and that choice can mean real money on your return.

For each one, note the date, what it was, what you paid, and how you paid for it (cash or a loan). Then find the receipt or invoice for anything around $2,500 or more. Those are the purchases most likely to get questioned, and the receipt is your proof. Ask your CPA what their cutoff is, because the right number depends on your situation.

Using a vehicle for both work and personal driving? Bring the mileage log, too. Yes, even the one living in the glove box under the napkins.

5. Untangle owner draws and money you put in

Money you take out for yourself and money you put into the business are not expenses or income. They’re owner equity, and they have to be recorded that way. Here’s where it usually goes sideways:

• Owner draws coded as an expense, which makes your profit look smaller than it really is. Not great when a lender asks to see your numbers.
• Personal money you put in recorded as income, which means you could pay tax on your own savings. Hard pass!
• Personal bills paid straight out of the business account and never moved over to draws.

And if you’re an S corp, make sure you actually paid yourself a salary through payroll this year. Your CPA will ask, and there’s no fun answer if you didn’t.

6. Chase your W-9s now, not in January

For 2026 payments, you generally owe a 1099-NEC to any sub you paid $2,000 or more, and the forms are due Monday, February 1, 2027. December is when you track down a W-9 for every one of them. Not late January, when your subs are just as buried as you are and significantly less motivated to go dig up their EIN.

Here’s the full 1099 guide for contractors, including who needs one and the easiest ways to file.

7. Sort out who owes who

Run your open invoices report (accounts receivable) and your unpaid bills report (accounts payable), then go through both with a suspicious eye:

• Is this invoice really still open? Payments that got deposited but never matched to the invoice are extremely common, and they make it look like your customers owe you way more than they actually do.
• Am I ever actually going to collect this? If not, talk to your CPA about writing it off. How that works depends on how your books are kept, so don’t just delete it and hope for the best.
• Is retainage tracked separately? Retainage you’re owed, or that you owe your subs, should be easy to find, not buried inside regular invoices.
• Do I actually still owe this bill? Old bills you already paid by card or check are another classic duplicate.

8. Hand it over in one tidy package

Ask your CPA when they need your books, then beat that date. Being the easy client has real benefits, and one of them is that your return doesn’t sit at the bottom of the pile until April.

A tidy year-end package usually includes:

• Profit and loss and balance sheet for the full year
• December bank, credit card, and loan statements
• Year-end payroll reports
• Your list of equipment and vehicle purchases, with receipts for the big ones
• Your 1099 list
• A short list of anything you weren’t sure about, so your CPA isn’t guessing

That last one matters way more than it sounds. “I wasn’t sure how to code these three payments” takes your CPA about five minutes to answer. Hunting down those same three payments on their own takes a lot longer, and you’re paying for every minute of it.

Rather not spend your holidays reconciling a fuel card?

Totally fair! I have never once seen “reconcile the fuel card” on anybody’s holiday wish list. That’s exactly what Tax-Ready Books is for. I’ll work through every step on this list, clean up the year, and hand your CPA a package they can use as is. It’s my year-end special for contractors, trades, and subs: sign by January 15 for the special price and guaranteed delivery by March 1. See what’s included and the pricing.

Not sure how messy things actually are? Start with a free books health check. You’ll get a score, your top risk areas, and a straight answer on what it would take to get clean. No judgment, I promise. I’ve seen worse!

This post is general information, not tax advice. Holly b. Accounting isn’t a CPA firm, so check your specific situation with your CPA.