The CPA Group, P.C.


4267 Canal Avenue SW

Grandville, MI 49418

Phone: 616-538-0460



November 2022

Some Timely Moves For Your Business

Some Timely Moves For Your Business

Just like your car, your business needs regular maintenance. Doing some year-end maintenance on your company’s finances can help ease workloads in the next few months.

As with your personal investment portfolio, if your company converted extra cash into investments, it likely saw gains in the first part of the year. But with inflation and increasing interest rates, investment returns have declined in the last several months.

Now may be the time to harvest some losses to offset your gains. Review your company’s investment portfolio with your financial professional to see if liquidating some assets makes sense.

Getting your company ready for year-end means having your financial records up to date. Focus on finalizing your third-quarter financial statements if they are still lingering. Review your payroll records to ensure all payroll taxes have been paid, and all federal and state payroll tax returns have been filed.

Also, see if there have been any late or missed payments to vendors? Are there any long-overdue invoices unpaid from customers? Are business expenses being tracked and recorded correctly? Are employees and independent contractors correctly classified?

Unfortunately, some inventory items don’t sell, and some debts go bad. While neither is ideal, these old items are tax deductible.

Old inventory, or inventory that can no longer be sold, is deductible as an expense. Since inventory only gets expensed when it’s sold, you can liquidate the items and deduct what you originally paid for them.

The same concept applies to uncollected debt, though what constitutes an uncollectable debt depends on your business. If you made an extensive effort to collect but have been unsuccessful, you generally can write it off. In either instance, you’ll need proper records to prove both situations. Consult your tax professional.


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