Bookkeeping · Financial Statements · Brief · Intro level
What to send your tax preparer, and how to book what comes back
The year-end handoff is a reconciled balance sheet, a full-year P&L, a general ledger export, and the supporting schedules. The preparer sends back adjusting entries — book them dated the last day of the year, then lock the period.
The year-end handoff to the tax preparer is a package, not a login. Send a reconciled year-end balance sheet, a full-year profit and loss, a general ledger export, and the schedules that support the balances — and expect something back: the preparer's adjusting journal entries, which you must book into the ledger so that next January your books and the filed return agree.
The package
The year-end handoff checklist:
| Step | What you send | What proves it's done |
|---|---|---|
| 1 | Balance sheet at year end | Every line reconciled or scheduled |
| 2 | Full-year P&L | Ties to the trial balance |
| 3 | General ledger / trial balance export | Preparer confirms import |
| 4 | Year-end bank, card, loan statements | Balances tie to the ledger |
| 5 | AR and AP agings at year end | Totals tie to the balance sheet |
| 6 | Fixed-asset additions and disposals list | Invoices attached |
| 7 | Payroll annual reports; inventory count | Tie to wage expense and Inventory |
Everything in that list should already exist if the December close ran properly — the deeper year-end work is covered in year-end close versus monthly close. Send a package with unreconciled cash and you are paying tax-season rates for bookkeeping.
What comes back, and how to book it
With the finished return, ask for the adjusting journal entries — many preparers won't send them unprompted. Common ones: depreciation to match Form 4562, reclassification of owner spending to draws or distributions, and accrual fixes. Book each one exactly as written, dated the last day of the year:
| Account | Debit | Credit |
|---|---|---|
| Depreciation expense | 7,240 | |
| Accumulated depreciation | 7,240 |
Dated December 31, even if you post it in April. It belongs to the closed year.
| Account | Debit | Credit |
|---|---|---|
| Owner draws | 3,150 | |
| Travel expense | 1,900 | |
| Meals expense | 1,250 |
The return excluded these; the books must too, or retained earnings diverges.
Then compare your post-AJE balance sheet to the return's balance sheet. They should match line for line; if they don't, resolve it now, while the preparer remembers the file. Finally, lock the year — the discipline in locking closed periods — so a stray edit can't unstitch a filed return.
The handoff also works better as a relationship than a transaction — timing, formats, and what the preparer actually wants are covered in working with the tax accountant.
What to do next
- Build the package from the table; reconcile before you send, not after they ask.
- Request the adjusting entries with the return, every year, in writing.
- Book the AJEs dated year end, tie your balance sheet to the return's, and lock the period.
Frequently asked questions
- What financial statements does a tax preparer need at year end?
- A balance sheet as of the last day of the year, a full-year profit and loss, and a general ledger or trial balance export — plus support: bank and loan statements at year end, the AR and AP agings, payroll annual reports, the fixed-asset list with purchases and disposals, and inventory count results. Reconciled first; the preparer's time is billed.
- What are the adjusting entries a tax preparer sends back?
- Typically depreciation and amortization to match the return, corrections the preparer found, accrual adjustments, and reclassifications of owner transactions. Book them in your ledger exactly as provided, dated the final day of the tax year, so your books match the filed return. Then lock the period so nothing drifts afterward.
- Why do my books not match the tax return?
- Usually because the preparer's adjusting journal entries were never booked back into the ledger. The return reflects them; the books don't, so retained earnings and asset balances disagree from then on. Request the adjusting entries with every return, post them dated year end, and confirm your closing balance sheet ties to the return's.