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As year-end approaches, businesses must prepare for both tax compliance and accurate financial reporting. One of the most common tax return risks is the improper calculation of the Section 199A Qualified Business Income Deduction, which can result in lost tax savings. Inventory valuation errors-such as misuse of FIFO, LIFO, or weighted-average methods, or failure to reconcile book and tax inventory-are also frequent. Businesses often miss valuable R&D tax credits due to poor documentation and may make bonus depreciation mistakes by improperly coding assets. Additional year-end concerns include misclassifying capital versus expenses, unreported or misclassified income, overstated deductions, unreconciled book-to-tax differences, state nexus errors, and payroll tax missteps such as worker misclassification and unreported fringe benefits.
From a financial reporting perspective, companies must ensure accurate inventory counts, proper overhead allocation, and compliant revenue recognition. Fixed asset records should reflect correct depreciation methods, asset disposals, and new acquisitions. Finally, expenses must be properly allocated between production, administrative, and selling functions.
Thorough year-end reviews of tax positions, inventory, payroll, revenue, and fixed assets help businesses avoid misstatements, reduce audit risk, and ensure compliance while maximizing legitimate tax benefits.
Saltmarsh is here to help ensure you are fully prepared for year-end reporting.
As year end approaches, businesses must prepare for both tax compliance and accurate financial reporting. One of the most common tax return risks is the improper calculation of the Section 199A Qualified Business Income Deduction, which can result in lost tax savings. Inventory valuation errors-such as misuse of FIFO, LIFO, or weighted-average methods, or failure to reconcile book and tax inventory-are also frequent. Businesses often miss valuable R&D tax credits due to poor documentation and may make bonus depreciation mistakes by improperly coding assets. Additional year-end concerns include misclassifying capital versus expenses, unreported or misclassified income, overstated deductions, unreconciled book-to-tax differences, state nexus errors, and payroll tax missteps such as worker misclassification and unreported fringe benefits.
From a financial reporting perspective, companies must ensure accurate inventory counts, proper overhead allocation, and compliant revenue recognition. Fixed asset records should reflect correct depreciation methods, asset disposals, and new acquisitions. Finally, expenses must be properly allocated between production, administrative, and selling functions.
Thorough year-end reviews of tax positions, inventory, payroll, revenue, and fixed assets help businesses avoid misstatements, reduce audit risk, and ensure compliance while maximizing legitimate tax benefits.
Cristine Torrefranca, Senior Manager
Saltmarsh Cleaveland & Gund
201 N. Franklin St. Suite 1625
Tampa, FL 33602
813-287-1111
cristine.torrefranca@saltmarshcpa.com
Services Offered: Accounting, Tax, Consulting, M&A
Website
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