Your 2026 year-end checklist: nine things to do before December 31
The moves that have to happen inside the calendar year, from owner salary and equipment purchases to W-9s for the new $2,000 1099 threshold, with the dates that matter.
Ruth Abernathy, CPA, licensed in Illinois Sample
Published · 7 min read
Most tax decisions for 2026 can still be made in March 2027. These nine cannot. They depend on something happening, a payment, a purchase, a payroll run, before the year closes. We start working through this list with planning clients in October, which leaves time to act.
1. Get the books current through September
Everything else on this list depends on knowing your profit so far. If the books are behind, catch them up first. Year-to-date profit through September, plus a fair guess at the last quarter, is the number every decision below starts from.
2. Decide on the fourth estimated payment
The last 2026 federal and Illinois estimated payments are due January 15, 2027. If profit ran ahead of last year, you may want to send more. If you are covered by the safe harbor, you may be able to send less. Decide in December so the cash is ready.
3. S corporation owners: finish your salary
Your reasonable salary for 2026 has to be paid through payroll by December 31. Check the year-to-date total now. If it is short, add it to the remaining paychecks, and make sure health insurance the company paid for you shows on your W-2.
4. Buy equipment you were going to buy anyway
Equipment placed in service by December 31 can be deducted on the 2026 return. The 2025 federal tax law restored 100% bonus depreciation for qualifying property acquired after January 19, 2025, and Section 179 lets many small businesses deduct the full cost in the first year as well. “Placed in service” means installed and ready to use, so a December 30 delivery that sits in the box until January misses the year.
Buy because the business needs it. A deduction returns only a share of the price.
5. Look at retirement contributions
A SEP-IRA can be opened and funded up to your return’s due date, including extensions, so it can wait. Other plans have earlier deadlines, and some employee deferrals have to come out of 2026 paychecks. If you are thinking about a solo 401(k) or adding a plan for staff, ask in November.
6. Collect W-9s for the new 1099 threshold
For 2026 payments, you file Form 1099-NEC for each contractor you paid $2,000 or more. Run a report of payments by vendor now, find everyone near or over $2,000, and get a W-9 from anyone missing one. Forms are due February 1, 2027, because January 31 falls on a Sunday.
7. Count your inventory
If you sell products, count what is on the shelves on December 31, or as close as you can, and write down how you valued it. That count sets your cost of goods sold for 2026.
8. Clean up who owes you
Look at invoices more than 90 days old. Make one last collection attempt. If you keep your books on the accrual method and a debt will not be paid, it can be written off as a bad debt in 2026. On the cash method, unpaid invoices were never counted as income, so there is nothing to write off.
9. Book your January meeting
Schedule the tax document handoff before the holidays. Our January dates fill by mid-December, and partnerships and S corporations have a March 15, 2027 filing deadline.
Dates on one page
| Date | What |
|---|---|
| December 31, 2026 | Owner salary paid, equipment in service, inventory counted |
| January 15, 2027 | Fourth estimated payment, federal and Illinois |
| February 1, 2027 | Forms W-2 and 1099-NEC to workers and the IRS (January 31 is a Sunday) |
| March 15, 2027 | Partnership and S corporation returns due |
| April 15, 2027 | Individual returns and C corporation returns due |
General information, not tax advice for your situation. This article explains rules as they stood on its last update date. Tax law changes, and the right answer for your business depends on facts we would need to see. Full disclaimer.
