Year-end bookkeeping checklist for Amazon sellers: closing 2026

A year-end close starts with books that show gross income, deductions and credits, backed by supporting documents (IRS: Publication 583 on records). For payments made in 2026, Form 1099-NEC reporting for a nonemployee's services generally starts at $2,000 (IRS: Form 1099-NEC FAQ). A foreign-owned US disregarded entity should also log contributions and distributions, which are reportable transactions for Form 5472 (IRS: Instructions for Form 5472).

What your year-end books must show

Your books must show your gross income, deductions and credits, and you must keep supporting documents (IRS: Publication 583 on records). Gross receipts are the income your business receives. Publication 583 says to keep documents that show their amounts and sources. Publication 538 adds that, besides your permanent accounting books, you must keep any other records needed to support the entries on your books and tax returns (IRS: Publication 538).

In a double-entry system, Publication 583 says you close income and expense accounts at the end of each tax year and keep asset, liability and net worth accounts open permanently (IRS: Publication 583 on records). Put simply, double-entry books count income and expenses one tax year at a time, while what the business owns and owes carries forward.

If your business uses a calendar tax year, that year is 12 consecutive months from January 1 to December 31 (IRS: Publication 583 on records). For that business, December 31 is the day the year closes.

How to close sales, inventory and contractors

Close sales so you can use them alongside Form 1099-K, value inventory if you keep one, and total your contractor payments for Form 1099-NEC.

Sales. Form 1099-K is the form that payment card companies, payment apps and online marketplaces send to the IRS each year when they are required to issue it. An online marketplace that must issue it also has to send you a copy by January 31 (IRS: Understanding your Form 1099-K). The IRS says to use Form 1099-K with your other records to help figure and report your taxable income. So close the year's sales in your books before the form arrives. For the matching steps, see how to reconcile Amazon Form 1099-K.

Inventory. If you choose to keep an inventory, Publication 538 says you generally must value it each year to determine your cost of goods sold (IRS: Publication 538). A small business taxpayer, as Publication 538 defines the term, can choose not to keep an inventory. That taxpayer must still use a method of accounting for inventory that clearly reflects income. The publication names two ways to do that: treat inventory as non-incidental materials and supplies, or follow the inventory treatment in an applicable financial statement (without one, in its books and records). Whether you qualify depends on your facts, so check with a qualified tax professional. See also whether Amazon fees are cost of goods sold.

Contractors. Form 1099-NEC reports payments to nonemployees for services. For payments made after December 31, 2025, you report payments totaling $2,000 or more in the calendar year, made in the course of your business to a person who is not your employee, for services (IRS: Form 1099-NEC FAQ). The earlier figure was $600. The IRS says the One Big Beautiful Bill Act (OBBBA) raised it and indexed it for inflation for calendar years after 2026 (IRS: Internal Revenue Bulletin 2026-19). Other reporting rules and exceptions can apply.

You must file Form 1099-NEC on or before January 31, on paper or electronically (IRS: Instructions for Forms 1099-MISC and 1099-NEC). If a due date in those instructions falls on a Saturday, Sunday or legal holiday in the District of Columbia or where the return is filed, it moves to the next business day. Under that rule, Form 1099-NEC for 2026 payments is due February 1, 2027. The same instructions say payments made with a credit card or payment card, and certain other payments including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity. Record how you paid each contractor.

What a foreign-owned LLC must log

A foreign-owned US disregarded entity logs its transactions with related parties, such as money the owner puts in or takes out, because Form 5472 reports them. If such an LLC has a reportable related-party transaction, it must file a pro forma Form 1120 (the US corporation income tax return) with Form 5472 attached, by that Form 1120's due date, including extensions (IRS: Instructions for Form 5472).

For such an LLC, reportable transactions include amounts paid or received in connection with forming, dissolving, acquiring or disposing of the entity, including contributions to and distributions from it. In plain terms, contributions and distributions are money you put in and money you take out. The instructions require a reporting corporation, which includes a foreign-owned disregarded entity that must file Form 5472, to keep books sufficient to establish that its federal income tax return is correct. Those books include records relevant to the correct treatment of transactions with related parties. The instructions set a $25,000 penalty on any reporting corporation that fails to file Form 5472 when due and in the manner prescribed, and the penalty also applies to a failure to maintain records (IRS: Instructions for Form 5472).

Two steps for the year-end close:

1. Log each contribution and distribution in a list kept apart from sales and expenses, with the document behind each one.
2. Keep the log with your books, so the records can support the correct treatment of each related-party transaction.

For the due date, the Form 1120 instructions give the general rule: a corporation files its income tax return by the 15th day of the 4th month after its tax year ends (IRS: Instructions for Form 1120). For a calendar tax year ending December 31, 2026, that general date is April 15, 2027. The instructions describe exceptions separately. See the federal tax calendar and the Form 5472 guide for foreign-owned LLCs.

Year-end checklist at a glance

The table lists each year-end item, its IRS source and its date where the source gives one. Use it even if a preparer files your return. The IRS says taxpayers remain responsible for all the information on their income tax return, regardless of who prepares it (IRS: Choosing a tax professional). If you are weighing outside help, see whether a foreign-owned LLC needs an accountant.

Year-end item	IRS source	Date
Close income and expense accounts (double-entry books)	IRS: Publication 583 on records	End of each tax year; December 31 for a calendar tax year
Keep documents showing amounts and sources of gross receipts	IRS: Publication 583 on records	—
Keep other records that support your books and returns	IRS: Publication 538	—
Value inventory, if you choose to keep one	IRS: Publication 538	Each year
Use Form 1099-K with your other records	IRS: Understanding your Form 1099-K	—
File Form 1099-NEC for 2026 business payments totaling $2,000 or more to a nonemployee for services	IRS: Form 1099-NEC FAQ; IRS: Instructions for Forms 1099-MISC and 1099-NEC	January 31; for 2026 payments, February 1, 2027 (next business day rule)
Log contributions and distributions (foreign-owned disregarded entity)	IRS: Instructions for Form 5472	—
File pro forma Form 1120 with Form 5472 (foreign-owned disregarded entity with a reportable transaction)	IRS: Instructions for Form 5472; IRS: Instructions for Form 1120	Form 1120 due date, including extensions; generally April 15, 2027 for a calendar 2026 tax year

Quick answers

Do I need to take an inventory at the end of the year?

If you choose to keep an inventory, Publication 538 says you generally must value it each year to determine your cost of goods sold (IRS: Publication 538). A small business taxpayer, as that publication defines the term, can choose not to keep an inventory. That taxpayer must still use a method of accounting for inventory that clearly reflects income. A qualified tax professional can tell you which option fits your facts.

When is Form 1099-NEC due for payments made in 2026?

Form 1099-NEC must be filed on or before January 31, on paper or electronically. If that date falls on a Saturday, Sunday or applicable legal holiday, it moves to the next business day (IRS: Instructions for Forms 1099-MISC and 1099-NEC). Under that rule, the form for 2026 payments is due February 1, 2027. It covers 2026 business payments totaling $2,000 or more to a nonemployee for services (IRS: Form 1099-NEC FAQ).

Does a foreign-owned LLC with no sales still need records for Form 5472?

Yes, if it is a foreign-owned US disregarded entity with a reportable related-party transaction. The Form 5472 instructions require such an LLC to file Form 5472 with a pro forma Form 1120. Its reportable transactions include contributions to and distributions from the entity (IRS: Instructions for Form 5472). Its books must be sufficient to establish that the return is correct, including records relevant to the correct treatment of transactions with related parties.

Where Taxller fits

Upload your Amazon settlement reports and Taxller turns them into double-entry books: sales, fees, refunds and payouts, split per payout. Our free tax calendar lists the federal deadlines for sellers and the state deadlines for 12 states, with weekend shifts applied and sources cited. Taxller never files or pays anything on your behalf: you or your accountant review and file.

Sources

• Publication 583, Starting a Business and Keeping Records
• Publication 538, Accounting Periods and Methods
• Understanding your Form 1099-K
• Form 1099-NEC & Independent Contractors (IRS FAQ)
• Instructions for Forms 1099-MISC and 1099-NEC (12/2026)
• Instructions for Form 5472
• Instructions for Form 1120