Mastering End-of-Year QuickBooks® Tasks for 2025

As autumn leaves fall and businesses prepare to transition into 2026, the importance of closing out the financial year accurately becomes paramount. By finalizing your books for one year, you establish a robust foundation for the next. In 2025, with changing tax regulations and the introduction of new QuickBooks® Online (QBO) features, here are essential tasks to complete by December 31 to ease into the next tax season.

1. Ensure All Bank & Credit Card Accounts Are Reconciled

Mitigate potential issues by reconciling each account in Settings > Chart of Accounts > Reconcile. Confirm that all accounts align with their statements, verify ending balances, and address discrepancies in Undeposited Funds or Uncategorized accounts. QBO now automatically flags unreconciled items to help avoid future surprises.

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2. Analyze Customer & Vendor Accounts

Utilize aging reports like Accounts Receivable Aging and Accounts Payable Aging to get a clear view of outstanding balances. Communicate with clients regarding unpaid invoices and consider writing off uncollectible debts where appropriate. Check vendor statements for any missing or incorrect entries.

3. Complete Year-End Financial Reports

Generate comprehensive Profit & Loss, Balance Sheet, and Trial Balance reports for the year. Scrutinize these for any inconsistencies such as incorrect balances or atypical entries. Applying filters by class or location can help spotlight any unusual variances.

4. Prepare 1099 Forms and Manage Contractors

Verify that all contractors are correctly designated for 1099-NEC or 1099-MISC forms. Use QBO’s Expenses → Vendors → Prepare 1099s function to ensure contractor information, such as addresses and W-9s, is current. Address any missing details to prevent IRS issues early in the new year.

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5. Execute Final Adjustments & Securely Close the Books

Finalize adjustments, including depreciation, amortization, bad debt, owner draws, and retained earnings. Confirm fiscal year settings in Settings→ Advanced for accurate period closure in QBO. After making necessary adjustments, close your books to safeguard against unintended modifications.

6. Refresh Payroll & Employee Information

For users of QuickBooks® Online Payroll, conduct the following prior to year-end:

  • Finalize the last payroll, incorporating all bonuses and commissions

  • Ensure all benefits, fringe payments, and retirement contributions are recorded accurately

  • Update employee details, including addresses, SSNs, and any W-4 changes

  • Review and correct W-2 forms before filing

7. Integrate Enhanced QuickBooks® Features & Automations

In 2025, QuickBooks® introduced upgrades in automation, categorization, and user interface enhancements. If your organization hasn’t utilized these, now is the ideal time, especially when managing multiple clients through QuickBooks® Online Accountant.

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Pro tip: Employ QBO’s cash-flow forecasting tools or conduct a “budget vs. actual” review to detect potential financial gaps. Prepare reserves or adjust estimated tax payments if 2025’s financials were impacted by unexpected costs or lowered income.

Avoid last-minute rushes at the end of the year by reconciling accounts, confirming balances, finalizing tax documentation, updating payroll, and leveraging QuickBooks®' newest offerings. Proactive measures now pave the way for a seamless 2026 financial journey, offering long-term benefits.

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