McDonald's Owner-Operators

Year-End Closing Checklist for McDonald's Owner-Operators

7 min read

Sep 18, 2026, 5:29:40 AM

There are two kinds of year-end in a McDonald's organization. In the first, someone spends late January reconstructing twelve months of records, a tax return gets extended, and the decisions that could have saved real money expired quietly on December 31. In the second, the close is a series of small, scheduled tasks that started in November and finished on time — and the tax planning happened while there was still time to act on it.

The difference between those two years has almost nothing to do with how good your bookkeeper is. It has to do with when you start. This article lays out the close as a three-month calendar: what to handle in November, which decisions genuinely lock on December 31, and what has to go out the door in January. Everything here is liftable — put the dates in your calendar and hand the checklists to whoever owns your books.

Nov 1

when a planned close actually starts

Dec 31

the date most tax decisions stop being available

Jan 31

W-2 and 1099-NEC deadline, no extensions in practice

November: The Month That Decides How Your Year Ends

November is when a year-end close is either won or lost, because November is the last month in which you can still change the answer. A projection produced in November gives you six or seven weeks to act. The same projection produced in January is a history lesson.

The single most valuable thing you can do in November is get a realistic estimate of your taxable income for the year, across the whole organization, and sit down with your accountant to look at it. Everything else on the November list exists to make that estimate trustworthy.

November checklist

Get current. Every month through October closed and reconciled — bank, credit card, and loan accounts against statements, not against memory.
Project the year. Estimated taxable income by entity and for the organization as a whole, with your actual year-to-date numbers, not last year's.
Book the planning meeting. One conversation with your accountant, in November, while the levers still work. This is the highest-return hour of your financial year.
Price the capital decisions. Equipment you know is due for replacement: get quotes and lead times now (see the December section for why lead times matter).
Clean up the vendor file. Confirm you hold a current W-9 for every contractor and service provider you paid this year. Chasing these in January is how January gets ruined.
Verify payroll data. Employee addresses, Social Security numbers, and any taxable fringe benefits, before W-2s are generated.

December: The Decisions That Genuinely Lock

Most of what people think of as year-end tax planning is really year-end tax timing, and the timing rules are unforgiving. Three are worth knowing precisely.

Placed in service means running, not ordered. To claim a first-year deduction on equipment, it has to be installed and ready for use in your restaurant by December 31 — not ordered, not paid for, not sitting on a loading dock. Under current law, qualifying equipment can generally be written off in full through 100% bonus depreciation, which the 2025 tax law made permanent, or Section 179 expensing of up to $2.56 million for 2026. Commercial kitchen equipment lead times can run weeks or months, which is why the November step above matters: a decision made on December 20 is usually a decision about next year's taxes.

Repairs are deductible in the year incurred. Routine repairs and maintenance are generally deductible when you incur them, so deferred maintenance you were going to do anyway may be worth completing before year-end in a profitable year. Major work that extends an asset's life may need to be capitalized instead, so flag anything significant to your accountant before you commit.

Smallwares can skip the analysis entirely. The de minimis safe harbor lets you expense items costing up to $2,500 each immediately — up to $5,000 each if your business has audited financial statements — with no depreciation schedule. It requires an annual election on your return and a matching expensing policy on your books, so confirm with your accountant that it is in place.

December checklist

Confirm installations. Anything you want deducted this year is in service and operating before December 31 — get the install date in writing.
Count inventory. A physical count of food, paper, and supplies at each restaurant on or near December 31, recorded and signed off by whoever counted it.
Walk the fixed asset list. Confirm what you actually still own. Equipment scrapped or replaced during the year needs to come off the books, and disposals can carry tax consequences of their own.
Review owner draws and compensation. Distributions and owner compensation year-to-date, checked against your plan and your entity structure.
Retirement contributions. Confirm deadlines for your plan type with your advisor — some allow contributions after year-end, others do not.
Note the last payroll. Know which pay date falls in which year, and accrue wages earned in December but paid in January.

"A year-end close is either a decision you make in November or a scramble you survive in February."

A Worked Example: What Six Weeks of Notice Is Worth

The figures below are illustrative, not research statistics — your numbers, entity structure, and tax rate will differ, so have your accountant run your actual position. Say a three-restaurant organization projects roughly $400,000 of taxable income for the year, and the November planning meeting surfaces two decisions already on the table: a $60,000 walk-in replacement that was going to happen eventually, and $30,000 of deferred maintenance.

Illustrative example	Decided in November	Decided December 20
Equipment installed and in service by Dec 31	Yes — ordered with lead time	No — installs in January
Maintenance completed before year-end	Yes — scheduled in slow weeks	Partly, at rush pricing
Deductions landing this year	$90,000	$15,000
Tax deferred at an illustrative 30% rate	$27,000	$4,500

Same two decisions, same organization, same money spent. The only variable is when the conversation happened. Note the honest framing: most of this is timing rather than permanent savings, and accelerating deductions is not automatically the right answer — in a year where next year's income will be higher, the opposite may be true. That's precisely the judgment the November meeting exists to apply.

New This Year: The 1099 Threshold Moved

One change is worth flagging specifically, because it affects the January work and the reporting threshold most operators have used for years. For payments made on or after January 1, 2026, the reporting threshold for Forms 1099-NEC and 1099-MISC increased from $600 to $2,000 under the 2025 tax law, with inflation adjustments in later years. That means fewer forms for many organizations when you file in January 2027.

Two cautions. First, the threshold change does not change the deadline or the need for documentation: you should still collect a W-9 from every contractor regardless of how much you pay them, because you won't always know in advance who crosses the line. Second, state reporting requirements don't automatically follow the federal threshold, so confirm your state's rules with your accountant rather than assuming they match.

January: Filings and the Final Close

January is execution. The work is mostly determined by how well November and December went, which is the whole argument for this article.

January checklist

By January 31: W-2s furnished to employees, and Forms 1099-NEC furnished to recipients and filed with the IRS.
Reconcile payroll. Quarterly filings against annual totals against your general ledger — the three should agree before anything is filed.
Close the year. Final reconciliations, accruals for expenses incurred but not yet paid, prepaid expenses adjusted to the right period.
Sales tax. Confirm returns filed and liabilities recorded match what your books show as payable.
Produce the statements. Balance sheet, P&L, and cash flow for the year, by restaurant and consolidated.
Compare to plan. Actual against budget, with an explanation for every meaningful variance. This is the conversation that sets next year's plan.
Assemble the tax package. Everything your accountant needs, in one place, so the return isn't waiting on a document request in March.

A reactive year-end	A planned close
Tax conversation happens in March	Tax conversation happens in November
Equipment ordered in late December	Equipment in service before December 31
W-9s chased in January	Vendor file current before the year closes
Inventory estimated from memory	Counted and signed off at December 31
Return extended, position unclear until autumn	Statements done in January, filed on time

REMEMBER

Nothing on the December list can be done in January. That's the entire reason the calendar matters — by the time the year is over, the only thing left to do is report it.

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Frequently Asked Questions

When should a McDonald's owner-operator start year-end planning?

November. A taxable income projection produced in November leaves six or seven weeks to act on what it shows; the same projection in January only explains what already happened. Most year-end tax planning is really timing, and timing requires runway.

What is the deadline for W-2s and 1099s?

January 31 — W-2s furnished to employees, and Forms 1099-NEC furnished to recipients and filed with the IRS. Confirm current-year dates with your accountant, and note that a missing W-9 is the most common reason this deadline becomes stressful.

Did the 1099 reporting threshold change?

Yes. For payments made on or after January 1, 2026, the threshold for Forms 1099-NEC and 1099-MISC rose from $600 to $2,000 under the 2025 tax law, with later inflation adjustments. Keep collecting W-9s from all contractors regardless, and check your state's rules separately, as they don't automatically follow the federal change.

Can I still deduct equipment I order in December?

Only if it is placed in service — installed and ready for use — by December 31. Ordering and paying are not enough. With commercial kitchen lead times running weeks or months, equipment intended as a current-year deduction generally needs to be ordered well before December.

McDonald's® is a registered trademark of McDonald's Corporation. Kelly+Partners is an independent accounting and advisory firm and is not affiliated with, sponsored by, or endorsed by McDonald's Corporation. Dollar figures in the year-end planning example are illustrative only. Tax rules and filing dates change and depend on your circumstances — this article is general information for owner-operators, not tax, legal, or financial advice, so please speak with your advisor before acting.