Business tax • October 26, 2026
By Michael J. Fusco, Legacy Wise Advisors
Every January, the same businesses call in the same panic: payroll starts next week and nothing is set up, the books are four months behind, and half the contractors who need a 1099 never handed in a W-9. None of that is a January problem. It's an October and November problem that got postponed. Here's the order to do it in — split honestly into what must happen before December 31, and what can safely wait until January.
Do these before December 31:
1. Reconcile the books through November — now, not at year-end. A bookkeeping cleanup done in December is a rush job done at the worst prices of the year. Reconcile bank and credit card accounts, chase down missing receipts, and separate anything personal that ran through the business accounts. Clean books are what every other decision on this list depends on — you can't time a purchase or fund a retirement plan against numbers you don't trust. This is the core of Prestige Tax Group's year-end work: bookkeeping cleanup and catch-up before filing season starts.
2. Collect W-9s from every contractor you paid this year. Forms W-2 and 1099-NEC are due at the end of January. In January, contractors are slow to respond and you're out of time. In November, one email gets you the form. No W-9 on file is the single most common reason January filings turn into a scramble.
3. Make the decisions that expire with the calendar. Equipment purchases you want counted this year, retirement plan decisions (a SEP or other plan for the business is a decision to make in Q4, even where funding happens later), and entity changes all turn on the year-end date. If you're forming a new business to start January 1, the business formation paperwork belongs in December, not in the new year. Our Q4 tax checklist covers the tax side of these decisions in detail — estimated payments, purchase timing, and use-it-or-lose-it spending.
4. If you own an S-corp, check your own salary. S-corp owners who work in the business must pay themselves reasonable compensation through payroll. Year-end is the last clean chance to true that up before the year closes.
Set this up in November for a January 1 start:
5. Payroll. A payroll switch or first-time payroll setup aimed at January 1 should be in motion by the end of November — accounts, employee records, pay schedules, and tax registrations all have lead time, and none of it improves under deadline pressure. Starting payroll clean on the first pay run of the year is dramatically easier than converting mid-year with year-to-date numbers to reconstruct.
What can wait until January:
6. The filings themselves. The Q4 estimated tax payment is due Friday, January 15, 2027, and the W-2 / 1099 filing deadline lands at the end of January — for the 2026 tax year, January 31 falls on a Sunday, so have everything ready in January rather than aiming at the deadline day. Funding certain retirement contributions can also extend past year-end within the plan rules. The point of doing steps 1–5 early is that January becomes paperwork, not archaeology.
The bottom line
January 1 is not a start date you improvise. Reconcile now, collect the W-9s now, decide the expiring items before December 31, and put payroll in motion by the end of November — and tax season opens with your records already in order.
General education only — not tax advice for any specific situation. Deadlines and rules vary by entity type and state; confirm your own dates before acting.
Prestige Tax Group Inc — powered by Legacy Wise Advisors provides tax preparation, bookkeeping, QuickBooks setup and management, payroll support, and business formations — virtually, for clients in New York, New Jersey, and nationwide during tax season. To start a year-end review, contact (929) 244-0744 or michael@legacywiseadvisors.com.