Dynamics GP 2025 Year-End Closing: A Practical Guide to Finishing Strong

Year-end doesn’t have to be stressful. With the right preparation, clear sequencing, and a trusted plan, closing the year in Dynamics GP can be smooth, accurate, and confidence-building.

At Njevity, our mission is simple: to improve the life and success of our customers and partners by providing exceptional business application experiences that simplify, inform, and delight. This guide reflects that mission—bringing clarity to the 2025 Dynamics GP year-end close, including Payroll and 1099 processing.

Whether you manage GP day-to-day or support it strategically, this blog walks you through what’s changed, what matters most, and how to close the year successfully.

Start with the 2025 Year-End Update

Is the Year-End Update Required?

In most cases, it’s not required, but it is always recommended. Think of the year-end update as a service pack—it runs updates across all companies and databases, so planning and timing matter.

Best practices before installing:

• Make a full backup of company and system databases
• Install the update on all GP workstations
• Install before closing any modules
  
  

What’s New for 2025?

The good news: minimal regulatory changes.

No IRS changes for:

• Payables 1099
• Payroll W-2 and W-3
• ACA 1095-C
  
  

No updates related to:

• Payroll Secure Act
• W-2 overtime premium
• No changes to electronic W-2 filing
  
  

The update does include:

• Fixed Assets luxury auto depreciation updates
• Quality fixes for select reports
  
  

Year-End Closing: The Right Order Matters

Dynamics GP year-end close is not a single button—it’s a sequence. Closing modules in the correct order helps ensure clean data and avoids downstream issues.

Modules to Close (in order)

1. Sales Order Processing (SOP)
2. Purchase Order Processing (POP)
3. Inventory Control
4. Receivables Management*
5. Payables Management*
6. Fixed Assets
7. Analytical Accounting
8. General Ledger

*Receivables and Payables can be closed by calendar or fiscal year, depending on your setup.

Key Module Highlights & Best Practices

Sales Order Processing

• Enter all transactions
• Reconcile sales documents
• Remove completed documents (preview with report-only first)
• SQL backup strongly recommended
  
  

Purchase Order Processing

• Enter all POP transactions
• Run and review the Received Not Invoiced report
• Reconcile purchase orders
• Optionally remove completed POs
• SQL backup recommended
  
  

Inventory: Timing Is Everything

Inventory should be closed at fiscal year-end, before entering any transactions that affect quantities.

What the process does:

• Moves current-year quantities and costs to last year
• Updates beginning quantities
• Resets quantity sold
• Optionally removes discontinued items and sold receipts
  
  

Before you close:

• Reconcile SOP, POP, and Inventory
• Complete inventory count and adjustments
• Print critical inventory reports
• Make a backup
  
  

Receivables & Payables Management

Close at the end of the calendar or fiscal year—before posting new-year transactions.

• Receivables moves finance charges or summary totals to last year
• Payables transfers 1099 or fiscal YTD totals
• Always print 1099s before closing Payables
• Always make a backup
  
  

Fixed Assets

Close Fixed Assets after:

• All AP transactions are posted
• Additions, retirements, and transfers are complete
• Depreciation is posted through year-end
  
  

The close clears YTD amounts and rolls balances forward cleanly.

Don’t skip these steps:

• Reconcile FA to GL
• Print reports
• Confirm GL posting
• Make a backup
  
  

Analytical Accounting

Analytical Accounting closes with the General Ledger, but Njevity strongly recommends:

• Running maintenance scripts to ensure GL and AA are in sync
• Verifying dimensions are included in GL
• Reviewing AA transaction dimension setup
  
  

General Ledger: The Final Step

General Ledger should be closed last.

The year-end close:

• Closes Profit & Loss accounts to Retained Earnings
• Rolls forward Balance Sheet accounts
• Marks the year as historical
  
  

Important reminders:

• You can still post adjusting entries to a closed year
• All users must be out of GP
• Review posting types before closing
• Always make a backup
  
  

1099 Review, Printing, and Filing

Before You Print

• Review 1099 vendors and amounts via reports or SmartLists
• Verify vendor setup and transaction classifications
• Check 1099 minimum thresholds
• Run Update 1099 Information if needed
  
  

Printing & Filing

• GP supports printing 1099s, but not electronic filing
• Several third-party electronic filing solutions are available, including Aatrix, Greenshades, and others
  
  

Payroll Year-End: What You Need to Know

2025 Payroll Update Highlights

• No form changes
• Fixes related to:
  • 941 preparation report display
  • Medicare waiver edge cases
  • W-2 Box 12 II printing issues
    
    

Payroll Year-End Close Checklist

• Install the final 2025 payroll tax update
• Complete all 2025 pay runs
• Reconcile 941 data
• Make a backup
• Close payroll year-end and create the wage file
• Verify W-2s tie to 941s
• Print W-2 and 1099-R forms
• Create electronic files if required
• Install the 2026 payroll tax update
  
  

Separate workflows apply depending on whether you process 2026 payroll before closing 2025. Reach out to support@njevity.com if you aren’t sure when to install the payroll tax update or need any other help with timing.

Editing W-2s: Two Approaches

Manual edits

• Faster, no system exit
• Requires careful tracking
  
  

Recreate the wage file

• Cleanest and most accurate
• Requires backup and user exit
  
  

Legislative Notes

While new legislation exists around overtime premiums and Secure 2.0, no related changes are included in the 2025 year-end update. Helpful configuration guidance is available through community resources:

Microsoft blog
OBBB

Final Reminders from Njevity

• Always make a backup before closing any module
• Ensure all users are out of GP
• Don’t update payroll tax tables until payroll year-end is complete
• Double-check GL posting types
  
  

Year-end closing doesn’t have to feel overwhelming. With preparation, sequencing, and the right guidance, you can close confidently—and start the new year on solid ground.

If you need help planning or executing your Dynamics GP year-end close, Njevity is here to help.

See the Process in Action

This webinar breaks down the Dynamics GP 2025 year-end close so you can finish the year strong.