It’s all hands on deck as you and your staff navigate the annual Christmas shopping season. As good as the season has hopefully been for you, January is on its way. Feel free to take the first few days to catch your breath. But after that, it will be time to get back to work. There are some important tasks you would do well to complete before the calendar turns to February.
Tasks typically completed in January close the books on the previous year and set the stage for the coming year. As a sunglasses wholesaler, we complete many of the same tasks that our retailer customers take care of in January. A few of them are described below. As you read, keep in the back of your mind that some of what needs to be done in January is a matter of law.
Send Out Your W-2s, W-3s, and 1099s
January is that time of year when employers have to send out their W-2 and W-3 forms. Those who deal with independent contractors also have to send out their 1099-MISC forms. All the forms must be filed and sent no later than January 31.
As a retailer of fashion sunglasses, we are guessing that you don’t have any independent contractors working for you. But if you do, any contractor to whom you paid more than $600 last year must receive a 1099-MISC. All your hourly and salaried employees get W-2s while your W-3s are sent directly to the Social Security Administration via their online portal.
Do the Year-End Inventory
In anticipation of filing your taxes, you will need to do your year-end inventory. The dates you use for inventory may be influenced by a tax year that differs from the calendar year. But most retailers follow the standard calendar year. Completing inventory for year-end purposes means counting only what you had in stock as of December 31.
Make Estimated Tax Payments
If your retail business is required to pay estimated income taxes, the deadline for 2020’s last quarterly payment is January 15. You can send your payment through the mail or online, using the IRS EFTPS website. If you choose the online method, just remember that it is difficult to cancel a payment once you’ve scheduled it. Be sure you enter the correct amount and date for payment.
January is also a good time to assess whether you will think you’ll need to pay a tax bill when you file your return in April. If so, now is a good time to start setting aside money to make that payment. Paying everything you owe by April 15 will eliminate the risk of penalties for late payment.
Establish a 2022 Budget
If your business operates on a budget (and it should), the time to create that budget is early January. It doesn’t have to be anything fancy. You can take your numbers from 2021 and use them as a framework for 2022. You can also take those numbers and build in a little extra to account for expected growth. In either case, a budget will help keep your finances on track in the coming year.
Here at Olympic Eyewear, we have our own list of business tasks slated to be completed in January. We have had an incredibly good 2021 thanks to loyal customers like you. We are anticipating an even better 2022. We hope you will continue to turn to us as your primary wholesaler of bulk fashion sunglasses. If there is anything we can do to improve our products and services, don’t hesitate to let us know.