Thousands of small businesses get Q4 tax prep wrong. Fix it with QuickBooks

Each year, many small businesses underestimate how critical Q4 is for tax prep. Don’t make that mistake. Use this quarter to wrap up 2025 tax planning, maximize deductions, and set yourself up for a smooth start to 2026.

Close the year strong: Why Q4 matters

The final quarter is the most important time to get your books in order. Tackling tax prep now helps you lock in savings, avoid last-minute stress, and head into tax season confident. 

QuickBooks financial literacy research finds that less than half (48%) of small business owners are confident they’re paying taxes correctly. That’s why smart Q4 strategies matter—they can help you:

Avoid year-end surprises

Catch errors before December 31 so you’re not scrambling in January.

Maximize deductions

Take advantage of year-end purchases and credits while you still can.

Strengthen your forecast

Review your books and plan for 2026 with accurate, up-to-date numbers.

Q4 tax prep checklist — finish the year right

Q4 is the last chance to get your records in shape before tax season. Reconciling, reviewing, and organizing your books now puts you in control before filing deadlines hit. This checklist of Q4 must-dos can help you avoid costly errors, maximize deductions, and head into 2026 ready.

1. Reconcile your accounts

Reconciling ensures all your business transactions match your bank and credit card statements. This catches errors, missed entries, or fraud, and provides accurate IRS-ready records. Doing it now prevents mistakes from rolling into the new year, and QuickBooks streamlines the process by automatically pulling in transactions.

2. Review and categorize transactions

Accurate categorization keeps your books clean, ensures deductions aren’t missed, and gives you reliable numbers for year-end tax planning. 

In QuickBooks, you can set up rules for recurring expenses to auto-categorize transactions, then do a manual sweep for missing receipts. Pay special attention to deductions like mileage, subscriptions, and home office expenses so they’re counted correctly before year-end.

3. Run year-end financial reports

Use QuickBooks to generate key financial reports, such as a profit & loss report to see where things stand for the year, and a balance sheet to review assets and liabilities. Comparing this year’s performance with last year’s helps you spot potential tax liability early and decide whether to make moves like larger purchases before December.

4. Update payroll records

Ensure payroll tax filings are current, and double-check employee and contractor details. With QuickBooks Payroll, you can keep W-2 and 1099 information accurate throughout the year, so forms are ready on time instead of becoming a January rush job.

5. Plan for quarterly and year-end taxes

The final estimated tax payment is due January 15 for many small business owners. QuickBooks calculates estimates and sends reminders so you won’t face penalties—or a surprise tax bill—in April.

Q4 pro tips to maximize tax readiness in QuickBooks

Ready to make Q4 easier? Use these QuickBooks-powered strategies to streamline your Q4 tax prep and stay organized as the year winds down.

Set up recurring reminders

Year-end is packed with deadlines. In QuickBooks, schedule reminders for tasks like payroll filings, invoice due dates, and quarterly tax payments to ensure nothing slips through the cracks.

• Why it’s important: Setting reminders can reduce stress and potential late fees or other penalties.
• How to: In QuickBooks, go to the reminders or tasks section and schedule alerts for key dates (e.g., payroll, reports). The system will notify when it’s time to act.

Use QuickBooks custom fields 

Custom fields let you track details that don’t appear in your chart of accounts, such as project names, client IDs, or campaign codes. You can add them to invoices, expenses, and sales forms, then filter or run reports using those fields. 

• Why it’s important: Custom fields give you a flexible way to categorize transactions for year-end tax planning strategies. It makes it easier to spot deductible expenses tied to specific projects or clients.
• How to: In QuickBooks Online, go to Settings > Custom fields > Add field. Choose where the field should appear (invoices, expenses, etc.), and save it. Once created, the field will be available to fill in on every new transaction.

Collaborate with a QuickBooks-certified accountant

Inviting a QuickBooks-certified accountant into your QuickBooks system gives them secure access to your books. 

• Why it’s important: A QuickBooks 2025 online survey found that 34% of business owners admitted to making a tax filing error. A year-end check-in helps you avoid becoming part of that statistic.
• How to: Find a QuickBooks ProAdvisor Accountant and invite them to access your QuickBooks account. They’ll be able to securely review your records and provide tailored advice without using one of your user seats.

Wrapping up Q4 2025 for year-end and beyond

Yes, early tax prep makes life easier once December rolls around. But it can also uncover money-saving solutions, provide peace of mind, and guide your decisions. Use QuickBooks to make Q4 a win—not a sprint—so you finish 2025 tax-ready and enter 2026 prepared for new opportunities.

Run through your Q4 checklist now in QuickBooks — get started here.