What Does My Accountant Need for Taxes?

It's March in Miami. The weather is starting to feel like a preview of summer, but for many business owners, a familiar sense of dread is creeping in. It’s tax season. The phone calls and emails from the CPA have become more frequent. Suddenly, a year’s worth of business activities needs to be condensed into a neat package of documents and figures.

For many, this means the annual ritual of the "shoebox." It might be a literal shoebox, or a drawer, or a folder on a desktop filled with unsorted files. It’s a frantic search for crumpled receipts from lunches, attempts to decipher cryptic credit card statements, and a struggle to recall the business purpose of a purchase made ten months ago.

This process is stressful for you. It is also inefficient for your accountant. When they receive a disorganized collection of raw data, they must spend valuable, billable hours doing the work of a bookkeeper. They sort, categorize, and piece together your financial story. This not only increases your accounting fees but also means they have less time to focus on high-level tax strategy. Important deductions can be missed, and the risk of errors increases.

The goal is to move from a reactive scramble to a proactive, organized process. Your relationship with your accountant should be strategic, not forensic. They should be helping you plan for the future, not just documenting the past. To do that, they need clear, well-organized information.

The Foundation: What Your Accountant Needs

Providing your accountant with organized information is the single best way to ensure an efficient, accurate, and cost-effective tax filing process. Think of it not as a chore, but as preparing a patient’s chart for a specialist. The clearer the chart, the better the diagnosis and treatment plan.

Here is a comprehensive breakdown of what your accountant will typically need to prepare your business tax return.

1. Core Business and Legal Documents

These documents establish the basic facts of your business. Your accountant likely has them from previous years, but it's always good to confirm if anything has changed.

• Previous Year's Tax Return: This is the starting point. It provides a baseline and context for the current year's figures.
• Articles of Incorporation or Organization: This confirms the legal structure of your business (e.g., S-Corp, LLC, C-Corp), which is fundamental to how your taxes are filed.
• Federal and State Tax ID Numbers: Also known as your EIN.
• Shareholder or Partnership Agreements: If you have partners, these documents are essential, especially if there have been changes in ownership or profit distribution during the year.

2. The Financial Statements

This is the heart of the information package. Ideally, these are not just raw data dumps but properly prepared reports from your accounting software.

• Profit and Loss (P&L) Statement: Also called an Income Statement. This report summarizes your revenues and expenses for the entire year. A clean P&L, with expenses properly categorized, is your accountant's primary roadmap.
• Balance Sheet: This provides a snapshot of your company's financial health at the end of the year. It lists your assets (what you own), liabilities (what you owe), and equity (the difference).
• General Ledger: While your accountant may not need the entire ledger, having it available is useful for clarifying specific transactions.

3. Records of Income

Your accountant must be able to verify every dollar your business earned.

• Gross Receipts: A summary of all your sales from products or services.
• Bank Deposit Slips and Statements: These should reconcile with the income reported on your P&L.
• Forms 1099-MISC, 1099-NEC, and 1099-K: If you received payments from other businesses or through third-party payment processors, you will receive these forms. They must be accounted for.

4. Records of Expenses

This is where disorganization costs businesses the most money through missed deductions. Simply providing a year's worth of bank and credit card statements is not enough. The expenses must be categorized.

• Bank and Credit Card Statements: All of them, for all business accounts.
• A Categorized List of Expenses: This should align with the expense accounts on your P&L. Common categories include:
  • Advertising and Marketing
  • Office Supplies
  • Rent or Lease Payments
  • Utilities
  • Insurance (Health, Liability, etc.)
  • Professional Fees (Legal, Consulting, Bookkeeping)
  • Salaries and Wages
  • Contractor Payments
  • Business Travel
  • Business Meals
  • Telephone and Internet
  • Software Subscriptions
• Payroll Reports: If you have employees, your accountant needs comprehensive payroll records. This includes total wages paid, payroll taxes withheld and paid (federal and state), and unemployment tax information. Your payroll provider should supply these reports, such as Form 941 and Form 940.
• Records of Payments to Contractors: A list of all independent contractors paid more than $600 during the year, along with their W-9 forms. This is needed to issue the required 1099-NEC forms.

5. Asset and Liability Information

These items relate to major purchases, sales, and debts.

• Major Asset Purchases: Provide documentation for any significant purchases of property or equipment, like computers, vehicles, or machinery. This includes the date of purchase and the cost. Your accountant needs this to calculate depreciation, a key deduction.
• Major Asset Sales: If you sold any business assets, provide the original cost and the sale price.
• Loan and Lease Agreements: Your accountant needs statements for any business loans, mortgages, or vehicle leases to properly deduct the interest paid.

6. Other Potential Necessities

Depending on your specific business, other information may be required.

• Vehicle Information: If you use a vehicle for business, you need a mileage log. This should detail the total miles driven for the year, the miles driven for business, and the miles for personal use. You will also need records of vehicle expenses like fuel, repairs, and insurance.
• Home Office Information: If you claim a home office deduction, you need to know the square footage of your office and the total square footage of your home. You also need records of your home expenses, such as mortgage interest or rent, utilities, insurance, and repairs.
• Estimated Tax Payments: Records of all federal and state estimated tax payments you made during the year, including the dates and amounts.

From Shoebox to System: A Better Way Forward

Looking at that list can feel overwhelming. It confirms why the March scramble is so stressful. But the solution isn't to get better at the last-minute scramble. The solution is to make the scramble unnecessary.

The difference between a stressed business owner and a prepared one is a system. That system is called bookkeeping.

Good bookkeeping is a year-round activity, not a once-a-year event. It is the process of recording, categorizing, and reconciling every financial transaction as it happens. When done correctly, producing the documents on the list above is not a major project. It is as simple as running a few reports from your accounting software.

Imagine this instead. It’s March. Your bookkeeper sends you an email with your finalized, year-end financial reports. You review them, and with a few clicks, you forward the clean, organized package to your CPA. Your accountant receives exactly what they need in a format they can immediately use. Their questions are minimal and strategic. They can focus their time on ensuring you've taken every available deduction and credit. Your tax return is filed on time, with confidence and without stress.

This reality isn't reserved for large corporations. It is achievable for creatives, insurance agencies, healthcare practices, and any small business in Miami that decides to prioritize its financial health.

Adopting a system has benefits far beyond a smoother tax season. When your books are always up to date, you have a real-time understanding of your business's performance. You can see your cash flow, track your profitability, and make informed decisions based on accurate data, not guesswork.

Getting started is the hardest part. It involves choosing the right accounting software and, most importantly, committing to a consistent process. For many business owners, handling this themselves is not the best use of their time. Your expertise is in running your business, not in the nuances of accounting standards.

That is where professional bookkeeping services come in. A good bookkeeper installs that system for you, manages it throughout the year, and acts as the crucial link between your daily operations and your accountant's high-level strategy. It transforms your financial data from a source of anxiety into a powerful tool for growth. The peace of mind alone is worth the investment.