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Your year-end 2026 bookkeeping and payroll checklist
Use the final months of the year to review payroll totals, contractor records and unfinished bookkeeping. Assign each task to someone and keep the supporting records with the filing checklist.
Last reviewed:
General information, not legal or tax advice.
Check Q3 filings before Nov 2, 2026
Q3 payroll and quarterly sales tax returns are due Nov 2, 2026, because Oct 31 falls on a Saturday. Review Form 941, California DE 9/DE 9C and the CDTFA quarterly sales tax return that apply to your business. Keep filing confirmations with the quarter’s records.
Sources: IRS Publication 509: 2026 tax calendar; California EDD: 2026 payroll tax calendar; CDTFA: sales and use tax return filing dates
Prepare for California pay changes on 1/1/2027
On 1/1/2027, California’s minimum wage rises to $17.40 and the exempt salary floor to $72,384. Review payroll setup and the employees affected before the new year begins.
Sources: DIR news release 2026-66: California minimum wage; California DIR news release 2026-66: 2027 minimum wage and exempt salary
Review the new W-2 TT and TP codes
The 2026 W-2 adds code TT for qualified overtime compensation and code TP for cash tips reported to the employer. Gather and review the supporting payroll records before preparing employee forms.
Review contractor payments against the $2,000 threshold
The 1099-NEC reporting threshold is $2,000 for 2026 payments. Review contractor totals and collect missing W-9 information as part of the year-end records check.
Plan for W-2 and 1099 filings by Feb 1, 2027
W-2 and 1099-NEC forms are due Feb 1, 2027. Review names, identifying information and payment totals before preparing the filings.
Sources: IRS: instructions for Forms W-2 and W-3; IRS: instructions for Forms 1099-MISC and 1099-NEC
Review AB 889 annualization records
AB 889 took effect January 1, 2026. When employer benefit payments are higher on public works than on private work, the credit must be annualized, and the bill removed the Director's exception and revoked annualization exemptions granted before 2026. That makes 2026 the first full year under these rules, so review each worker's annualization records at year-end. Bring public and private hours together with benefit contributions for each worker’s annualization records.
Sources: AB 889 (2025), chaptered bill text, California Legislature
Close the bookkeeping gaps
Reconcile bank and credit card activity, review unpaid bills and customer balances, and identify payroll entries that need correction. Keep open questions in one list for your bookkeeper and tax adviser.
Sources
- AB 889 (2025), chaptered bill text, California Legislature
- IRS Publication 509: 2026 tax calendar
- California EDD: 2026 payroll tax calendar
- CDTFA: sales and use tax return filing dates
- DIR news release 2026-66: California minimum wage
- California DIR news release 2026-66: 2027 minimum wage and exempt salary
- IRS: instructions for Forms W-2 and W-3
- IRS: instructions for Forms 1099-MISC and 1099-NEC
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We can file this for you
We prepare and file payroll returns, W-2s and 1099s using the records you provide. We also help with sales tax filing and certified payroll records.