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Ready, Set, File: The Ultimate Year-End Ecommerce Accounting Guide for a Stress-Free Tax Season

As we approach the year’s end, it’s time to tackle the ecommerce accounting tasks we’ve been avoiding. Doing it right the first time not only saves headaches but also money. With tax season looming, ensuring your ecommerce books are in order is crucial for timely tax filing, understanding your profitability, and planning for the next year.

Here’s a 10-point checklist to make your tax filing process smoother and stress-free.

10 Essential Keys to Tax-Ready Ecommerce Financials:

1. Complete Bank and Credit Card Transactions

Have you booked all your bank and credit card transactions? Overlooking transactions can lead to inaccuracies in your financial records.

2. Hidden Accounts Check

Don’t forget accounts like PayPal or other less obvious ones. Missing these can significantly affect your financial picture.

3. Sales Recording

Ensure every sales channel is represented in your P&L. Missing out on platforms like Etsy or Shopify can distort your revenue understanding.

4. Diverse Payment Methods

For D2C sellers using platforms like Shopify, capturing every payment method used is vital. Neglecting even one can skew your sales data.

5. Accurate COGS

Book your cost of goods sold (COGS) appropriately. Valid and believable COGS are crucial for true profitability analysis. Stay tuned for our next blog for more on this!

6. Amazon Fee Segregation

Carefully split your Amazon fees and refunds from sales. Proper accounting here is essential for a clear financial view of your Amazon operations.

7. Balance Sheet Reconciliation

Ensure balance sheet accounts match with the December 31st statements. Accurate and independently verified balance sheets reflect the true financial health of your business.

8. Loan Interest Capture

Did you remember to book the interest expense on your loans? This often-overlooked step is essential for accurate debt reporting.

9. Receivables and Payables Sanity Check

Do your receivables and payables make sense? A common-sense check here can reveal accounting errors needing attention.

10. Inventory Reconciliation

Inventory reconciliation is a common struggle but is vital. Ensure your inventory figures are accurate. Almost all ecommerce sellers struggle with this, so are giving this tricky topic its own article. Look out for our upcoming blog for guidance!

“Do It Right, Do It Light” vs. “Do It Wrong, Do It Long:”

Getting it right the first time means you won’t have to redo it, keeping your tax professional happy and reducing your stress. Last-minute efforts often result in poor quality, so use this checklist to prepare your books for tax filing.

If the thought of bookkeeping overwhelms you, remember that we at Seller Accountant are here to help. Our unique approach combines resources and coaching to drive results, ecommerce expertise, and accurate financial insights for stronger cash flow and profitability. Our goal is to empower every entrepreneur we serve to make a difference in their lives and communities. Let us handle the numbers, so you can focus on what you do best – growing your business.

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