This section explains the different parameters required to execute the Offline 1099 process. Due to the complexity of the job, it is very important the parameters are set correctly. Special attention needs to be paid to the 1099 Processing Options and Controls (1099P) page.
The 1099D table defines the From and To date range associated with a Document Code that will be used to select records from the 1099 Journal. While the 1099 process normally selects records based on a calendar year (January 1– December 31), this table allows you to define the date range that a specific Document Code should be selected. For example, the Record Date of a transaction on 1099 Reporting Journal must be between or equal to the Record Date range provided on the 1099D record associated with the Document Code for the Calendar Year defined by the batch parameter. Other date ranges can be entered to provide additional selection criteria for the transactions on the 1099 Journal. Those include the From and To Acceptance Dates and From and To Check/EFT Issue Date. The From and To Check/EFT Issue Dates are only allowed for Document Types of AD, DC and MD. When multiple date ranges are entered, the transaction must meet all criteria to be selected.
The following example shows how the From and To Acceptance Dates can be utilized by the Offline 1099 Batch process when specified on the 1099D table.
An example of the 1099D table setup for a JVA transaction would be:
Calendar Year: 2008
Document Code: JVA
From Record Date: 01-01-2008
To Record Date: 12-31-2008
From Acceptance Date: 01-01-2008
To Acceptance Date: 01-20-2009
From Check/EFT Issue Date: <blank>
To Check/EFT Issue Date: <blank>
This setup says “select from the 1099 Journal all reportable JVA transactions processed with an Acceptance Date (that is, Run Date) between 01-01-2008 and 01-20-2009 and a Record Date between 01-01-2008 and 12-31-2008”.
The following examples show how the From and To Check/EFT Issue Dates can be utilized by the Offline 1099 Batch process when specified on the 1099D table.
An example of the 1099D table setup for an AD transaction would be:
Calendar Year: 2008
Document Code: AD
From Record Date: 01-01-2008
To Record Date: 01-20-2009
From Acceptance Date: <blank>
To Acceptance Date: <blank>
From Check/EFT Issue Date: 01-01-2008
To Check/EFT Issue Date: 12-31-2008
This setup says “select from the 1099 Journal all reportable AD checks issued during the calendar year 2008 (that is, has a Check/Issue Date between 01-01-2008 and 12-31-2008) where associated transactions, including cancellations, were processed with a Record Date between 01-01-2008 and 01-20-2009”.
An example of the 1099D table setup for a DC transaction would be:
Calendar Year: 2008
Document Code: DC
From Record Date: 01-01-2008
To Record Date: 01-20-2009
From Acceptance Date: <blank>
To Acceptance Date: <blank>
From Check/EFT Issue Date: 01-01-2008
To Check/EFT Issue Date: 12-31-2008
This setup says “select from the 1099 Journal all reportable DC transactions processed with a Record Date between 01-01-2008 and 01-20-2009 to stale date checks issued during the calendar year 2008 (that is, has a Check/Issue Date between 01-01-2008 and 12-31-2008)”.
Entries on this table are not required for every disbursement document code. If a Calendar Year and Document Code combination does not exist on this table for the calendar year that the 1099 process will run against, the batch process will assume that the records posted during the calendar year are eligible for 1099 Reporting (assuming all other 1099 eligibility requirements are met).
The 1099P table allows a user to define the parameters required by the Offline 1099 Process to create IRS forms, data file, Generated Forms Report, and/or Data File Audit Report. Selection criteria for each calendar year are entered on three sections: General Information, Payer Information, and Form Input Information. Entries to this page can be added and changed throughout the calendar year as the Offline 1099 Process can be executed multiple times. The batch process will issue an error and stop if the Calendar year defined by the batch parameter does not contain a record on this table.
The General Information section provides the calendar year for which the parameters are valid, the processing mode, last processing mode, the input to be used, the reports to be generated and whether the process is running for corrections or not. The Processing Mode determines how the 1099 records are processed.
The purpose of each mode is as follows:
1099 Report: To generate reports so that users can preview the vendor income that would be produced from the Offline 1099 Process. This mode does not update tables or create any files.
Testing: To generate a report of the consolidated vendor income by Taxpayer ID Number in a condensed format so that users can preview the result of the Offline 1099 Process prior to actually executing. This mode will update the 1099 Reporting Income (1099R) table in "Testing" mode.
Forms: To send the forms out to the vendors in advance of generating the magnetic media file reported to the IRS to help reduce the amount of correction records to be reported to the IRS.
Magnetic Media: To generate the magnetic media file as well as the 1099 forms in one execution. Therefore, the 1099 process does not need to be executed in Forms mode.
Correction: To generate corrected 1099 forms and magnetic media records in the format dictated by the IRS.
The Processing Mode parameter provides the following options for how to process the 1099 records:
|
Processing Mode |
Input |
Processing Ind on updated records on 1099 Reported Income table |
Forms generated (Y or N) |
Data File generated (Y or N) |
|
Report |
1099 Journal |
N/A - records are not added to 1099R or 1042R with this mode |
N |
N |
|
Testing |
1099 Journal and 1099 External Reported Income (1099ER) table. |
Testing |
Y |
N |
|
Forms |
1099 Journal or 1099ER with the Processing Indicator of Testing , Updated or New if this is the first run of the Offline 1099 Process for a Calendar Year. Otherwise, the input will be the records on 1099 Reported Income (1099R) or 1099ER with a Processing Ind of Testing, Updated, or New. |
Forms |
Y |
N |
|
Magnetic Media |
1099 Journal or 1099ER with the Processing Indicator of Tested, Updated or New if this is the first run of the Offline 1099 process for a Calendar Year. If this is not the first run of the Offline 1099 Process and Forms mode was the previous run, the input will be the records on 1099 (1099R) or 1099ER Reported Income with a Processing Ind of Forms, Updated, or New. If this is not the first run of the Offline 1099 Process and Testing mode was the previous run, the input will be the records on 1099 Reported Income or 1099ER with a Processing Ind of Testing, Updated, or New. |
Magnetic Media |
Yes if Forms mode not previously run or if the record on 1099 Reported Income or 1099ER has a Processing Ind of Updated or New |
Y |
|
Correction |
Records on 1099 Reported Income with a Processing Ind of Updated or New. |
Corrected |
Y |
Y |
Regardless of the Processing Mode, the first time the Offline 1099 Process is executed for a calendar year, the 1099 Reporting Journal and 1099ER table if it set on the parameter should be used as input. Unless the processing mode is Report, a record is created on the 1099 Reported Income table for each 1099-S Form Number, 1099 Reporting Payer, Taxpayer ID Number, TIN Type, and Form Type who has reportable income on the 1099 Reporting Journal. Records are added onto the 1042-S Reporting Income (1042R) table fore each 1099 Reporting Payer, Taxpayer ID, and TIN Type who has reportable income on the 1099 Journal. The Offline 1099 Process will continue to select records from the 1099 Reporting Journal as long as the 1099 Journal as Input check box is set to true on the 1099P table. After the process is executed in Forms Generation mode, you need to procedurally set the 1099 Journal as Input check box to false on the 1099P table. If this does not occur, the records on the 1099R table will be initialized (for example, Box Amounts = blank) and the 1099 Journal will be used as input. Once the process runs in Forms Generation mode, procedurally any necessary corrections are applied to the current record on the 1099 Reported Income table, 1099 External Reported Income table, or 1042-S Reported Income table. Therefore, the 1099 Reported Income, 1099 External Reported Income table, and 1042-S Reported Income tables are used as input for any further executions of the Offline 1099 Process (assuming the 1099 Journal as Input check box is set to false). A new record is created on the 1099 Reported Income or 1042-S Reported Income table for each 1099 Reported Income record processed (based on the Processing Mode and Input criteria). The only exception occurs when the input record has a Processing Indicator of Updated. In this case, no new record is added, but instead the Generation Date and Processing Ind are updated on the existing record. Records from the 1099 Journal will not be added to the 1099 External Reported Income (1099ER) table nor will records from the 1099ER table be added to the 1099R or 1042R tables.
If the 1099-S Reporting indicator on 1099P is set to TIN/TIN Type & Property, 1099-S records will not be inserted onto 1099R by the 1099 Offline Batch Process. In this case, all the 1099-S records must be added to 1099R manually using the 1099 Maintenance (M1099) document or directly enter them to the 1099R table. However, if the 1099-S Reporting indicator on 1099P is set to TIN/TIN Type then 1099-S records will be inserted onto 1099R by the 1099 Offline Batch Process for each 1099-S Form Number, 1099 Reporting Payer, Taxpayer ID Number, TIN Type, and Form Type.
The Last Processing Mode field on the 1099 Processing Parameters window indicates in what mode the 1099 process was previously executed. This indicator is initially [spaces] and gets updated by the Offline 1099 process with the corresponding processing mode. When the indicator is [spaces], the Offline 1099 process uses the 1099 Journal as input. The Last Processing Mode also determines what Processing Mode the Offline 1099 Process can be executed in, as follows:
|
Processing Mode |
Last Processing Mode |
|
Testing |
[spaces] or Testing |
|
Forms |
[spaces] or Testing |
|
Magnetic Media |
[spaces], Testing, or Forms |
|
Correction |
Magnetic Media or Correction |
The Options and Controls section contains settings that help control the 1099, Backup Withholding, and 3402(t) Contract Withholding functionality. Fields in this section include:
The 1099 Backup Withholding, 1042-S Withholding, and Contract Withholding fields activate the corresponding withholding offset in the system.
Amounts in the 1099 Backup Withholding Rate and IRS Penalty Amount fields will be used in Backup Withholding calculations on disbursement documents, as well as by the Backup Withholding batch process to be included on the printed B Notices.
1099-S Reporting field which controls how 1099-S forms are produced by TIN/TIN Type or by Property.
IRS Penalty Amount allows your site to specify the penalty amount on the 1st and 2nd B Notices for vendors that are subject to Backup Withholding
Compliance Days allows your site to define the time limit in days that the Taxpayer has in order to return information that was requested in the 1st or 2nd “B” Notices.
The number of days specified in this field will be used as a selection criterion by the Initiate Backup Withholding process to select records from the 1099 Reporting Information table, for which the number of days since the 1st or 2nd “B” Notice was sent, is greater than or equal to the number of Compliance Days. The calculated date will difference will exclude weekends and holidays as defined on CLDT table.
This field will also be used by the Print Backup Withholding Notices batch process during the record processing. This process populates the Backup Withholding Notice Printing History table with information about vendors, for which the 1st or 2nd “B” Notice has been generated (see section 2.1.13). The number of days specified in the ‘Compliance Days’ field will be added to the Application Control Date and this date will be populated by the batch process in the ‘Compliance Date’ field on BWNPH table. The calculated date will exclude weekends and holidays as defined on CLDT table. The calculation will include a verification to ensure that the last prior business day is selected if the ‘Compliance Date’ falls on weekends and/or holidays.
The Contract Withholding Rate field indicates the percentage to withhold if the Contract Withholding check box is selected.
The Contract Withholding Threshold field indicates the minimum disbursement threshold that needs to be reached in order for Advantage to determine eligibility for Contract Withholding. During Automated Disbursement, the Contract Withholding Threshold is compared to the total Line Amount less Discounts and Retainage for each payment grouping. On a manual disbursement, the Contract Withholding Threshold is compared to the vendor line amount less Discounts and Retainage.
The Apply Contract Withholding to PCard Payments field indicates if the site will apply contract withholding to payments made for Procurement Card activities. If this check box is selected, the disbursement process will apply Contract Withholding on PCard payments that meet the contract withholding threshold and that are not exempt from contract withholding. A value is not allowed in this field if the Contract Withholding check box is not selected.
The 1099 Reporting Payer Information (1099RP) table supports the 1099 Offline batch process by allowing more than one payer as well as more than one transmitter to receive their data extract file of the 1099 magnetic media.
If the Multiple 1099 Reporting Payers flag has been checked on the System Wide Options (SOPT) table then the 1099 Reporting payer value will be retrieved from the Department Fiscal Year (DEPTFY) table and will be used instead of the 1099 Single Payer value for the 1099 Offline batch process. This allows a Reporting Payer per department to get their specific 1099 magnetic media file instead of one Payer per calendar year.
This table has the following sections:
Payer Information section - The Payer Information section allows your site to enter your own Taxpayer Identification Number, TIN Type, and Contact Information. This information will be included in the Payer data file that Advantage generates as part of the 1099 Process and will be updated to the "Payer’s" fields on the 1099 Forms when this data file is imported into 1099 Convey.
Form Input Information section is used to designate the text to be displayed in Box 3 of Form 1099-S.
The combination of Calendar Year (CY) and Transmitter Control Code (TCC) must be valid on the 1099 Transmitter Information (1099TI) table in order to save a record on the 1099RP table. A pick is available for the TCC to the 1099TI table. If the Multiple 1099 Reporting Payers flag on the SOPT table is set to Yes; then more than one “Payer” record may be defined per calendar year on this table. However, if the Multiple 1099 Reporting Payers flag is set to No, then only one “Payer” record will be allowed on the 1099RP table for the given calendar year. The 1099 Offline Batch Process retrieves the 1099 Reporting Payer information and the Form 1099-S, Box 3 information from the 1099RP table.
Please refer to the run sheet for the Offline 1099 Process for the parameters of the batch job in the CGI Advantage Financial Accounts Payable Run Sheets guide.