The solopreneur refers to someone who organizes, manages, and assumes the risks of a business without the help of a partner or other shareholders. While potentially very rewarding, the life of a solopreneur is often a mix of business highs and lows, slow times, where there seems to be no work at all, that can quickly change to overwhelming workloads with intense deadlines.

When meeting with clients who own and operate their own businesses this time of year, I like to frame the discussion around two critical functions for the financial health of any business. 

  1. Bookkeeping 
  2. Tax Planning

Whether a brand new start-up or a decade old publicly traded company, all businesses need to make sure they have accurate and reliable books and records as well as proactive (not reactive) tax planning. 

It might be hard at first and require an investment of money and time, but take it from me – the sooner you can produce an accurate Profit & Loss Statement and a Balance Sheet of your business the better. Consider the services of a bookkeeper or ask your accountant if they offer bookkeeping consulting services to help make sure you can produce accurate financial statements every year. 

In order to help you save on taxes and strategize for business growth, the quality of your books and records are critical. The Profit & Loss and Balance sheet tell the story of your business – leave fantasy to JK Rowling and make sure your business story isn’t fiction, but is an accurate biography! 

Finalizing your books and proactive year-end tax planning should be on every business owner’s calendar this time of year. Here are some ideas to act on this time of year. I have broken out each point between those that can be addressed as part of your bookkeeping and those that are part of tax planning. 


Schedule time with your bookkeeper or accountant to review the books and discuss the following

  1. Reconcile Accounts: Make sure all business bank accounts and credit cards are reconciled for the year. 
  2. Open Transactions: Clarify any transactions that you are not sure about. For those of you QuickBooks users – clear out your “Ask My Accountant” account by asking your accountant on anything you are not sure about. 
  3. Roll Forward your Equity Accounts: Make sure the balances in your “owner’s contribution”, “owner’s distribution”, and “retained earnings” accounts are accurate.
  4. Financial Statements: Request an accurate year-to-date Profit & Loss Statement and Balance Sheet to review with your accountant. Once you have this done for multiple years, you can review comparative statements which can really be eye opening in making smart business decisions. 

Tax Planning

Schedule time with your accountant to review your current tax projection and discuss the following:

  1. Tax Estimates: Timing of any Q4 tax estimates for the year. 
  2. Income/Expense Planning: Deferring vs. accelerating revenue and deferring vs. accelerating expenses. Depending on your circumstances and expectations for next year, you might be better off recognizing more income this year compared to next year. The opposite might be true as well, where you would be better off recognizing more expenses this year compared to next year. Confirm the optimal situation and act on it! 
  3. “SALT” Deductions:  Many states have strategies to deduct more than the $10K limit under current Federal law. These “SALT” workarounds can provide huge tax savings for business owners. 
  4. Structure: Consider converting to a different tax structure that might make more sense as business grows. The S-Corp conversion is a popular strategy for many solopreneurs, but you need to consider trade-offs between payroll tax savings, QBI tax savings, and other compliance requirements when changing structures. 
  5. Retirement Contributions: Ask your accountant about how a SEP-IRA, Solo 401K, or other tax deferred account could help you save on taxes today while helping fund retirement. 

The life of a business owner is hectic, so it can be hard to balance the time you need to work “in the business” as opposed to “on the business.” Finding a trusted advisor to help with the work that takes you away from why you went into business for yourself in the first place is critical! 

Surround yourself with competent and trustworthy professionals, but remember even the best accountants can’t read your mind or predict the future – without a clean set of books and proactive discussions with your hired professionals you will not realize all the benefits they can offer! 

Get a proactive start on closing out 2022 so you can go into 2023 with a solid foundation, actionable game plan, and clear runway to take your business to the next level! 


The information contained herein is intended to be used for educational purposes only and is not exhaustive. Diversification and/or any strategy that may be discussed does not guarantee against investment losses but are intended to help manage risk and return. If applicable, historical discussions and/or opinions are not predictive of future events. The content is presented in good faith and has been drawn from sources believed to be reliable. The content is not intended to be legal, tax or financial advice. Please consult a legal, tax or financial professional for information specific to your individual situation.

This content not reviewed by FINRA

Northbrook Financial is an Investment Adviser registered with the State of Maryland. All views, expressions, and opinions included in this communication are subject to change. This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned.

The Solopreneur Checklist 2022

Please contact us at 410-941-9709 if there is any change in your financial situation, needs, goals or objectives, or if you wish to initiate or modify any restrictions on the management of the account. Our current disclosure brochure, Form ADV Part 2, is available upon request, and on our website