Ok, so tending to year-end business tasks may not be the most exciting thing you’ll do all year. However, taking care of these tasks may pay big dividends over the long run.
Of course, there is an extensive list of things to get done at year end; some of them more important than others.
How important a task is to your business depends on the type of business you’re in. If you carry inventory, do business with many vendors, maintain multiple locations, have 1000s of employees, maintain a fleet of cars, conduct business overseas, all of it impacts what needs to get done.
But there are a handful of tasks that are relevant across the board and certainly apply to your small medical office. These year-end business functions include:
- Taxes on your business
- Insurance for your business
- Marketing to promote your business
Well, let’s dive right in. Let’s get started with taxes.
#1 Year-End Business Task: Taxes
If you only do one thing at year-end, make sure you take care of anything and everything related to your taxes, including federal, state and local taxes. Nothing will push a business into failure faster than neglecting taxes.
Verify and mark all tax deadlines (federal, state and local) as they apply to your business. Remember deadlines vary depending on the legal structure of your business.
The IRS maintains an online tax calendar for businesses & the self-employed. This calendar might be a good place for you to start.
W-2s and W-3s
If you are an employer, make sure year-end payroll tasks get completed. Both W-2s and W-3s are filed at the beginning of the New Year but cover the previous year.
Prepare and submit W-2s (year-end employee wage and tax statement) and W-3s (transmittal of wage and tax statement) by the deadline.
The W-2 is a multi-part form. One copy is given to the employee, and the other copies are submitted to local, state and federal taxing authorities.
The deadline to file the 2016 forms is January 31st, 2017.
Both, employers and self-employed are required to submit a 1099-MISC if certain criteria are met.
Prepare and mail a 1099-MISC (contractor year-end tax summary) to every contractor who has done work for you in excess of $600 in the previous year.
This may include work for things such office cleaning, rent paid for your office space, consulting fees you paid to get the new computer system up and running.
If you’re not sure what falls under the 1099-MISC, click on the following link to get more detail directly from “The Horse’s Mouth” on what qualifies for 1099-Misc income.
You’re not required to submit a 1099-MISC if you paid under $600 a year to any one contractor. Please verify this statement with your accountant, tax preparer, or the IRS.
Self-Employment Taxes (federal and local)
If you are required to pay self-employment taxes, make sure you’re payments are up-to-date and on schedule. The last of the four quarterly federal Self-Employment payments is due on January 15th (unless the date falls on a weekend or holiday).
It’s time to make an appointment with your accountant or tax advisor. Go over what you need to prepare to be ready to file taxes.
Review the performance of your business. Did you hit your business goals? Or did your business miss the mark? Discuss what needs to be improved.
You may want to investigate what could be done to minimize future taxes while maximizing deductions (of course all legal). Get any outstanding tax and accounting issues handled now.
For every employee collect and update the contact information you have on file. Update the information in your accounting system, telephone system, and anywhere else important to your business.
Making sure you have correct and up-to-date information on file, ensures you can get in touch with your employees when you need to.
Additionally, give your employees the opportunity to update their tax withholding information. Provide each employee with IRS form W-4 before year-end.
Ask that they review their tax withholding information for accuracy. Alternatively, have them fill out a new W-4 to reflect any changes in their withholding status.
Remind your employees that their withholding status can be updated at any time throughout the year if necessary.
NOTE: Please verify the accuracy of filing dates, tax reports and other tax requirements with the IRS or your tax preparer. The information presented in this article is not intended as a substitute for professional accounting advice.
#2 Year-End Business Task: Insurance
Review all your insurance policies for coverage and rates. Make sure you carry adequate coverage and make any updates if necessary. Discuss with your insurance company to see if adjustments in limits or deductibles might lower your premiums.
Make sure you and your business carry all legally required insurance policies. Don’t get caught off guard. Don’t open yourself to potential problems down the road because you forgot to get coverage.
Additionally, you may consider carrying insurance that’s recommended but not legally required. You may include coverage for things like business interruption, employment practices liability, cyber liability, just to name a few.
#3 Year-End Business Task: Marketing
Everywhere you look, year-end is used to review and refine goals and strategies. How you choose to market your practice is no exception.
The end of the year is a good time to review the performance of your marketing over the previous 12 months.
- How effective was your marketing?
- Did it bring you a consistent flow of new patients?
- Did you implement your marketing as planned?
- Were you able to accomplish your goals staying within your budget?
- Did your marketing fall to the wayside? If so, why?
Next, take a look at your practice website, which is an integral part of your marketing. Your website will do one of three things for your business.
It will either:
- Bring new patients to your office.
- It won’t do anything for your business.
- Or in the worst case scenario, it will repel prospective patients from your clinic.
Keeping the above information in mind, how is your website working for your business? Is it working for you or against you?
For your website to work for you, there are a few main items to focus on.
- Keep it current: is your site up-to-date, displaying correct information?
- Keep it fresh: do you consistently showcase fresh content, such as new and interesting articles?
- Professional: does your site represent your office in a professional manner?
This wraps up our discussion of your bare-bones, year-end business tasks.
Remember, if you choose only to do one thing, let it be your taxes!
Here’s what to do next…
- Check up on your taxes: Review all taxes and corresponding reports related to your business.
- Check up on your insurance: Review all insurance policies. Make sure coverage levels are adequate, and deductibles are at optimal levels.
- Check up on your marketing: Review your marketing practices, your campaigns, and your website. Are your marketing efforts bringing new patients to your practice? Is the information on your site current and represents you in a professional manner?
We want to hear from you! Let us know what you think.
Is there’s something you do at year-end that helps you get ready for the next 12 months? Why not share it here, with your colleagues.
By Johanna Hofmann, MBA, author of “Smart Business Planning for Clinicians” and a regular contributor to the NPBusiness blog.