The Monthly Bookkeeping Checklist for Small Business Owners

Monthly bookkeeping is the difference between a calm tax season and a frantic one. Use this checklist at the start of each month to close out the previous month.

1. Record all income

• Make sure every sale, deposit and payment app transfer is recorded
• Match payments to the invoices they paid
• Record any cash or check payments

2. Categorize all expenses

• Categorize every bank and credit card transaction
• Attach receipts, especially for meals, travel and larger purchases
• Note business purpose for meals and travel

3. Reconcile every account

• Reconcile business checking, savings and credit cards to their statements
• Reconcile payment platforms like PayPal, Square or Stripe
• Investigate any differences right away; they're much harder to find later

4. Review accounts receivable

• Run an aging report of unpaid invoices
• Follow up on anything past due
• Decide whether any old invoices are uncollectible

5. Review accounts payable

• Make sure bills are entered and scheduled
• Check for duplicate payments or missing bills

6. Record payroll and owner activity

• Confirm payroll entries and payroll tax liabilities are recorded correctly
• Record owner draws, distributions and contributions

7. Handle Washington excise taxes

• Calculate sales tax collected by location
• Run gross receipts for B&O classifications
• File and pay on your assigned schedule (monthly filers are generally due the 25th of the following month)

8. Review your financial reports

• Profit and loss: compare to last month and the same month last year
• Balance sheet: check that balances make sense (no negative bank balance, no strange liabilities)
• Cash flow: where did the money go?

9. Check tax savings

• Move your tax percentage to the tax savings account
• If it's a quarterly estimate month, confirm the federal payment amount

10. Track contractors

• Collect W-9s from any new contractors
• Note who's approaching the 1099 threshold

11. Back up and organize documents

• Store statements, receipts and contracts in a consistent folder structure
• Make sure your software's bank connections are still active

How long does it take?

For a small service business with a few dozen transactions a month, an experienced bookkeeper can often complete this in a few hours. If you're doing it yourself, block a recurring time on your calendar, such as the first Tuesday of each month.

The bottom line

A consistent monthly routine catches errors early, keeps tax filings on time and gives you real numbers to run your business. If you never find the time, that's the clearest sign it's time to delegate.

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Need help getting this right? TRIG Bookkeeping & Tax Services helps new business owners in Washington with company registration, monthly and annual bookkeeping, and government compliance. Contact us to talk about your business.

This article is general information, not legal or tax advice for your situation. Tax rules and fees change, so confirm current details with the IRS, the Washington Department of Revenue, or a qualified professional.