This article documents how to setup and process 1099s for vendors. 

The 1099 form is a series of documents the IRS refers to as "Information Returns". There are a number of different 1099 forms that report various type of incomes.

ERP currently provides 1099-MISC (Independent contractor income), 1099-DIV (Dividends income) and 1099-INT (Interest income).

1099 Box Setup

This 1099 Box will indicate which type of 1099 form and which type of income the vendor is setup for.

For example: the 1099-MISC form has a number of different types of miscellaneous incomes such as Rents, Royalties, Other Income, Federal Income Tax Withheld, etc...

Each type of income was assigned to a box number on the form by the IRS.

For example:

1099-MISC for Rents will be printed in box number "1".

1099-MISC for Royalties will be printed in box number "2".

1099-MISC for NonEmployee Compensation will be printed in box number "7".

ERP currently provided an up to date list of 1099 box types for 1099-MISC, 1099-DIV & 1099-INT.

1. Navigate to Master > Payables > Vendor 1099 Box.
   
   
2. Click on the 1099 Box ID ellipsis button.
   
   
   
   
   
   
3. Click on Retrieve button. 
   
   
   
   
   
   
4. The system will display a list of existing 1099 box Type IDs. Select the type of income that is appropriate for the vendor.
   
   
   
   
   
   
5. Click Add.
   
   
6. Click Save.
   
   
7. Click Close.
   
   

From time to time, the IRS will add new box for new type of income. That means that new developments will be needed to add the new box to the form. To add new 1099 box:

1. Type in new 1099 Box ID > Specify 1099 box number > Set up Comment/Description for the new 1099 type ID.
   
   
   
   
   
   
2. Click Add.
   
   
3. Click Save.
   
   
4. Click Close.
   
   
   

1099 Type Setup

There are a number of different 1099 forms to report various type of incomes.

ERP currently provides 3 different types of 1099 - 1099-MISC (Independent contractor income), 1099-DIV (Dividends income) and 1099-INT (Interest income).

If another 1099 form/type needs to be added to ERP, it will require new developments for that form. To add new Vendor 1099 Type:

1. Navigate to Master > Payables > Vendor 1099 Type.
   
   
   
   
   
   
2. Click on the Add button.
   
   
3. Type in new 1099 Type ID.
   
   
4. Type in new 1099 Type. This value is assigned by the IRS.
   
   
5. Type in new Comment/Description.
   
   
6. Click Save.
   
   

7. Click Close.
   
   

1099 Vendor Setup

To set up a vendor to receive 1099 forms:

1. Navigate to Master > Payables > Vendor.

   
   
2. Select your Vendor > Click OK.
   
   
3. Check the 1099 Vendor check box.
   
   
4. Check the Payee's Account Number (1099) -
   . If you have multiple accounts for a recipient for whom you are filing more than one Form 1099 (INT, DIV, MISC). 
   . The account number is also required if you check the “FATCA filing requirement” box (Foreign Account Tax Compliance Act). 
   . Additionally, the IRS encourages you to designate an account number for all 1099 forms that you file.
   . When this box is checked. The vendor's short name will be printed in the "Account number" box on the 1099 forms.
   
   
5. Select the Default 1099 Type - MISC, DIV or INT. Even though this 1099 type is set to default, it can be changed at the vendor's voucher level.
   
   
   
6. Select the Default 1099 Box - default 1099 type of income for the vendor. Again, this 1099 box is set to default, but it can always be changed at the vendor's voucher level.
   
   
   
   
   
7. Click Save
   
   
8. Click Close

1099 info on Vendor Voucher

When you create a new voucher, if the vendor is set up for 1099, these information will be automatically default from the vendor's master.

You can exclude this voucher from all the 1099 reporting by unchecking the 1099 box.

The 1099 Type and 1099 Box can be changed by clicking inside the selection area, then click on the dropdown list, a list of options will be displayed.

1099 Reports

After you make the voucher payment, you can run a 1099 report to review who/what is included on the 1099 report.

Navigate to Payables > Reports > 1099 Report.

1. The report can be run in Summary or Detail mode. In detail mode, it will show all vouchers details transactions. One line per voucher.
   
   
2. Select which 1099 type to print or you can select All 1099 Form Types.
   
   
   
   
   
   
3. You have to select a company because this report is running by company. Each company has its own unique Federal Identification Number. 
   
   
   
   
   
   

4.  Select a Division or select All.

    

5. Select a Vendor Type or select All.

   
   

6. Select a Vendor or select All.

   
   

7. If you want the vendor address to display on the report, please check this box.

   
   

8. By default, the report will bypass vouchers that are less than $600.00. If you want to include vouchers that are less than $600.00, please check this box.

   
   

   
   

   
   

9. Select a Start Pay Date and End Pay Date, then click Show Report button.

   
   

   
   

   
   

    

1099 Forms

When your 1099 report is all in balance. You can run your 1099 forms.

Navigate to Payables > Reports > 1099 Forms.

1. Select 1099 Type - Div, Int or Misc.
   
   
   
   
   
   
2. Select Forms that you want to print by check or un-check the boxes. You can print all forms or just the forms that you need.
   
   . Copy A = Internal Revenue Service Center.
   
   . Copy B = Recipient.
   
   . Copy C = Payer.
   
   . Copy 1 = State Tax Department.
   
   . Copy 2 = to be filed with recipient's state income tax return, when required.
   
   
   
   
   
   
3. Select the company that you want to process 1099 forms.
   
   
4. Fill in the name of the contact person in case there is any issues or questions for the 1099 forms from the IRS.
   
   
5. Fill in the contact person's phone number.
   
   
6. Fill in the contact person's email address.
   
   
7. A valid Federal Identification Number is required.
   
   
8. You don't have to have a State Identification Number to run the 1099 forms.
   
   
9. Check on the Bypass $600.00 Minimum if you want to include vouchers that are less than $600.00.
   
   
10. Select the Start Pay Date and End Pay Date
    
    
11. Click on the Show Report.
    
    
12. If everything is correct, you can print these forms. These forms can be printed as many time as you need.
    
    
    
    
    
    
    
    

1099 Electronic Files

We usually would suggest that you should wait to make sure that there are no issues with any of the 1099 forms. Sometimes the vendors have issues with the 1099 forms and will bring them back. You will then need to correct the issues and re-print the 1099 forms for the vendors.

Once all the 1009s are printed, you can create the 1099 Electronic File.

Navigate to Payables > Reports > 1099 Electronic File. 

1. Select 1099 Type
   
   
2. Select Payment Year.
   
   
3. Select Company.
   
   
4. Provide a valid Federal Identification Number.
   
   
5. Transmitter Control Code is a required number. This number is an assigned number by the IRS.
   
   
6. Enter the Transmitter Name.
   
   
7. Enter the name of the Contact person.
   
   
8. Enter the phone number of the Contact person.
   
   
9. Enter the email address of the Contact person.
   
   
10. If you need to create an electronic file for Federal, do not check this box. If you check this box, the system will create records K for the state and the federal will reject the file.
    If you need to create an electronic file for the state, then please check this box.
    
    
11. Check the box for Bypass $600.00 Minimum if you want to include vouchers that are less than $600.00.
    
    
12. Click Retrieve button.
    
    
    
    
    
    
13. Proofing the data within the 1099 electronic file - make sure that all the information for all records type are correct.
    
    . Record T - Transmitter record
    
    . Record A - Payer record.
    
    . Record B - Payee record.
    
    . Record C - End of Payee record.
    
    . Record K - State Totals record.
    
    . Record F - End of Transmitter record.
    
    
    
    
    
    
    
14. Click on the Errors tab - there should not be any errors generated.
    
    
    
    
    
    
15. Once everything has been checked and verified, you can click on the Save button and save it to a place where you can browse into later to submit the file to the IRS website.