Closing Out 2025: Year-End Records Worth Pulling Now

Etsy sellers who track cost of goods throughout the year can generate most of their tax-season profit and loss report in minutes rather than reconstructing it from a shoebox of receipts, according to inventory-and-accounting platforms built specifically for makers.

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Table of Contents

Introduction

This is the exact five-record pull we recommend to Etsy sellers every year during the quiet week between Christmas and New Year’s, while the immediate holiday rush has faded but the details of how the year actually went are still fresh. In this guide, we’re walking through the five specific things worth pulling from your shop and your books right now: sales and expense totals, real margins, a written record of what worked, your Star Seller and shop health trends, and your tax set-aside. None of this takes an ongoing project’s worth of time. A few focused hours this week, done deliberately, sets up a far stronger foundation for 2026 planning than trying to reconstruct any of it from memory in April. Let’s start with the one every seller means to do all year and usually puts off until tax season forces the issue.

1. Pull Your Actual Sales and Expense Totals

Reconstructing a full year of sales and expenses from memory in April is slower, less accurate, and more stressful than pulling the same numbers now, while the records are still recent and the receipts haven’t scattered.

This works because tax season compresses a year’s worth of bookkeeping into a few weeks of pressure, right when accountants and tax software are also busiest and least able to help you sort out a missing receipt. Pulling your totals now spreads that same work into a quiet week with no deadline attached.

Here’s the deal: if you’ve been using an inventory or accounting tool built for makers throughout the year, this is largely a matter of running a report rather than manually reconstructing anything. Platforms designed specifically for handmade sellers tie cost of goods to each sale as it happens, which means a shop that’s been logging materials consistently can generate a full-year profit and loss view in minutes instead of days. We covered exactly this kind of underused feature in our breakdown of Craftybase’s tax-ready reporting, and this is the week that feature earns its keep.

If you haven’t been logging consistently, don’t try to fix a year of gaps in one sitting. Pull what Etsy’s own Shop Manager reports already give you (order totals, fees, and refunds by month) and build your expense side from bank and card statements rather than trying to remember individual purchases.

Here’s how to do it:

1. Export your full-year sales report from Shop Manager’s Finances section, broken out by month if your tool supports it.
2. Pull material and supply costs from your accounting tool, or from bank/card statements if you haven’t been logging as you go.
3. Total any other business expenses separately: Etsy fees, shipping supplies, software subscriptions, and any paid advertising.
4. Save all three totals somewhere you can find them in April, not just this week.

Pro Tip: If this is the first year you’re doing this properly, don’t aim for perfect. A close, honest estimate pulled now beats a more “accurate” number you never actually reconstruct later because the task felt too big to start.

A note on recordkeeping requirements: the IRS doesn’t require a specific bookkeeping system, but it does require records that clearly show your income and expenses and that you can produce if asked. The IRS’s official recordkeeping guidance for small businesses is worth a read once a year if you’ve never checked it, since the underlying requirement rarely changes but it’s easy to assume you’re covered without ever confirming it.

2. Reconcile Your Real Margins Against What You Assumed

Pull your actual full-year margin and compare it, line by line, against what you assumed when you set prices earlier in the year, because a gut feeling that “costs went up” isn’t the same as knowing exactly how much your margin actually moved.

This works because pricing decisions made under pressure, especially the kind of cost-driven pricing adjustments many shops made earlier this year, are usually based on a rough estimate at the time, not a full year of real sales data confirming whether the adjustment actually held.

Now: this year gives that reconciliation unusual weight. Given how much sourcing cost pressure followed the de minimis exemption ending back in the spring, a lot of sellers adjusted prices at some point in 2025 based on an estimate of what costs would do for the rest of the year. We covered the reasoning behind that kind of decision in our Q4 pricing strategy piece, and this is the week to check whether that estimate actually held up against real numbers.

Picture a shop that raised prices roughly 8% in September on its imported-material product lines, based on an estimated cost increase. Pulling the full year’s numbers now might show the actual per-unit cost rose closer to 12%, meaning the shop is still absorbing a real margin gap on those specific listings heading into 2026, one that’s invisible without this exact comparison.

Here’s how to do it:

1. Pull your average material cost per unit at the start of the year and again for Q4, for your best-selling product lines specifically.
2. Compare that to your actual price and the margin you assumed you were protecting when you last adjusted pricing.
3. Flag any product line where the real margin gap is wider than what you priced for.
4. Note which listings need a correction heading into 2026, rather than assuming last year’s adjustment still holds.

Pro Tip: Do this per product line, not as one blended shop-wide number. A shop-wide average can look fine while specific listings are quietly losing money, and blended numbers hide exactly the gap you’re trying to find.

3. Document What Worked and What Didn’t, Specifically

Write down, specifically, which product lines and decisions performed well this year and which didn’t, while the details are still fresh, rather than relying on a vague year-end impression that fades within a few weeks.

This works the same way it did after every seasonal transition this year: specific, dated notes taken close to the event hold up; general impressions formed weeks or months later get flattened into “that was a good year” or “that was a rough stretch,” without the actual detail that would help you make a better decision next time.

We suggested this same exercise after nearly every seasonal transition in 2025, back-to-school in August and again after Halloween’s wrap-up in October, and it applies at the full-year level too, if anything more, since a full year compresses even more detail than a single season.

Here’s how to do it:

1. List your top five product lines by revenue and, separately, by actual margin, since they’re often not the same five.
2. Write down one specific bottleneck that cost you real time or money this year: a supplier switch, a shipping delay pattern, a listing that underperformed for a reason you can name.
3. Write down one thing that worked better than expected, specifically enough that you could repeat it on purpose.
4. Save this note somewhere you’ll actually open again, not a sticky note that gets lost by February.

Pro Tip: Force yourself to write at least one sentence with a specific number or date in it per item. “Sales were good in October” is a vague impression. “The gothic-elegant Halloween line sold through by October 20, two weeks earlier than last year” is a fact you can act on.

4. Review Your Star Seller and Shop Health Metrics for the Full Year

Look at your Star Seller and shop health metrics across the entire year, not just your most recent quarter, because a full-year view reveals patterns a single busy month obscures.

This works because Star Seller status is evaluated on a rolling three-month window, which means your most recent quarterly snapshot only tells you how the last stretch went. A shop that comfortably holds Star Seller status right now might still have had a rough Q3 worth understanding, or a steady, quiet improvement across the year that a single quarter’s numbers wouldn’t show.

It gets better: this is also the moment to see whether the discipline you built during your busiest stretch actually held. We wrote about the specific risk of Q4 volume pressuring these exact metrics in our piece on protecting Star Seller standing as order volume climbs, and now you have the full-year data to check whether the buffers you built actually worked.

Etsy’s own Star Seller Checklist in the Seller Handbook lays out the three core metrics the badge is built on: message response rate, on-time shipping rate, and review rating, each evaluated over a rolling three-month period. Pulling a full year of these three numbers, not just your current three-month snapshot, shows you exactly where the badge status has real room to spare versus where it’s been repeatedly close to slipping.

Here’s how to do it:

1. Open Shop Manager’s Customer Service Stats tab and record your response time, on-time shipping rate, and review rating for each quarter of the year, not just the current period.
2. Note any quarter where a metric came close to the threshold, even if you still held Star Seller status at the time.
3. Identify whether a dip was a one-time event (a single late shipment during a shipping-carrier delay) or a recurring pattern worth actually fixing.
4. Carry forward whatever buffer worked best this year into your 2026 planning, rather than assuming your process will automatically hold under next year’s volume.

Pro Tip: A shop that held Star Seller status all year by a comfortable margin has more room to take on next year’s growth. A shop that held it by repeatedly scraping just past the threshold has a capacity problem worth addressing directly, not just a metric to keep watching nervously.

5. Set Aside What You’ll Actually Owe in Taxes

Calculate roughly what you’ll owe in taxes for the year and set that amount aside now, rather than discovering the number for the first time when you file.

This works because a specific, calculated number is something you can plan around; a vague sense that “I probably owe something” tends to turn into a stressful surprise exactly when cash is already tight coming out of the holiday season.

Question is: have you actually been setting aside a portion of income throughout the year, or is this the first time you’re calculating it? If you haven’t, use your Step 1 totals to estimate roughly what you’ll owe, based on your net income (revenue minus real business expenses) and your expected tax bracket, and set that amount aside in a separate account now rather than treating it as part of your available cash going into January.

If you make quarterly estimated tax payments as a self-employed seller, the IRS’s estimated taxes guidance is the authoritative source on due dates and how the underlying calculation works; the fourth-quarter 2025 estimated payment is generally due in mid-January 2026, which makes this exact week the right time to confirm you have the amount ready rather than scrambling in the days right before the deadline.

Here’s how to do it:

1. Take your net income figure from Step 1 and apply your rough expected tax rate (a tax professional or your prior year’s return is the most reliable source for this, not a guess).
2. Set that dollar amount aside in a separate savings account, not your general operating cash.
3. If you owe a Q4 estimated payment, confirm the amount and the due date now, with enough runway to make the payment on time.
4. If this year’s number is meaningfully different from last year’s, note why (higher revenue, higher costs, a pricing change) so it’s not a mystery next December.

Pro Tip: This calculation is an estimate, not a filing. Nothing here replaces a conversation with a qualified tax professional about your specific situation, especially given how much material cost pressure shifted mid-year for many sellers this year.

A general disclaimer: this guide describes a general approach to year-end recordkeeping and is not tax, legal, or accounting advice. Tax rules, filing deadlines, and estimated payment thresholds are set by the IRS and can change; confirm your specific obligations with a licensed tax professional or directly on IRS.gov before making any filing or payment decision.

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