If you’re a contractor and we’re just past year end, here’s the truth: your tax bill should not be a surprise.
By the time December 31st hits, construction business owners should already have two things locked in: a solid estimate of your tax liability, and confidence that you’ve already pulled every lever you’re going to pull for that year.
Once the year is over, most of the real tax planning window is gone. What’s left now isn’t about finding magic write-offs to make the liability disappear. It’s about accuracy and confirmation—making sure the numbers match what you already expected.
So What Do You Focus on Now That Year End Has Passed?
The priority is simple: close your books properly.
That means every single bank account and credit card is reconciled through December 31st. No unclear transactions. No mystery expenses sitting in limbo. No “I’ll figure that out later” line items.
You need to know what every balance on your balance sheet actually represents. Owner draws. Loan balances. Sales tax and payroll tax liabilities. Every number should make sense, with no mysteries or surprises lurking.
Here’s the thing most contractors don’t realize: the balance sheet is where the skeletons hide.
Your P&L might look fine, but if your balance sheet is a mess—uncategorized transactions, mystery balances, reconciliations that are six months behind—your profit number is really just a guess. And if your profit is a guess, your tax liability is a guess. That’s exactly where surprise tax bills come from.
What Clean Books Actually Look Like
Before you can trust your tax number, you need to make sure:
- Every bank account is reconciled through 12/31
- Every credit card is reconciled through 12/31
- Owner draws are accurate and match what actually came out
- Loan balances match your actual statements
- Sales tax and payroll tax liabilities are correct
- Your “Uncategorized” or “Ask My Accountant” buckets have a zero balance
Until all of that is done, your profit is a guess. And guessing doesn’t work when the IRS is involved.
The Right Process (For Next Year)
Here’s what we want our roofing and construction clients to have in place:
Before year end: A tax estimate and a plan. Know what you’re going to owe and pull the levers you need to pull before December 31st.
After year end: Clean books that match that story and that plan. Tax filing should just be formalizing what you already know, not discovering it for the first time.
That’s the difference between contractors who get surprise tax bills and contractors who don’t.
If You’re Staring at QuickBooks Right Now and Don’t Know Your Numbers
If you’re looking at your books right now and don’t actually know what you made last year, or you’re worried there might be a surprise hiding in there, that’s exactly what our 60-Day Roofing Clarity Sprint is built for.
We come in, clean and reconcile the year, fix the classifications, build you a simple dashboard, and give you a clear picture of what you actually made and what you owe.
More importantly, we build the systems to keep this from ever being a surprise again.
Because the goal isn’t just to survive this tax season. It’s to never be in this position again.
Ready to get your books clean and your tax picture clear? Contact us today and we’ll show you exactly where you stand and what it takes to fix it.
