Prior to processing 1099 returns, you must ensure the 1099 programs are set up for the current 1099 year and that the workfiles do not contain information from the prior year.
This section contains the following topics:
The 1099 Processing Options Setup program (P04510STUP) provides one place for the 1099 programs to retrieve the standard information to generate returns, such as the 1099 calendar year, the alternate/related combining options, and the 1099 minimum amounts. Multiple programs access these processing option values when generating 1099 returns, therefore the system uses only version ZJDE0001 of P04510STUP.
From Annual 1099 Setup (G0442), choose 1099 Processing Option Setup
Review each processing option to verify they are set up with complete and accurate information.
Verify this processing option contains the current 1099 reporting year and it is in the two-digit format for the year; for example 19 for the year 2019.
Enter the phone type for the system to use to retrieve the phone number that it includes on the 1099 reports and forms that you generate during the process. If the system cannot locate a phone number for the phone type that you specify, it uses the phone number for the blank phone type.
If you leave this processing option blank, the system uses the first phone number that it locates in the Address Book - Contact Phones file (F0115) for the address book record.
Enter the code that you want to use to create the relationship among the address book records in the first Alternate/Related Address Combining processing option. During the 1099 process the system uses the code from this processing option to retrieve the correct address book number from the Related Addresses file (F01017), which it uses to retrieve the mailing name and address that prints on the 1099 form.
If you leave the processing option blank, the system combines suppliers and companies with the same tax ID and uses the mailing name and address of the first supplier combining address number or company combining address number record that it locates in the 1099 Combined Workfile (F04514).
If you want to combine companies, but the companies do not share the same EIN, enter a 1 in this processing option to assign the EIN from the Company Combining Address field in the 1099 workfiles to all of the related company records in the same workfiles.
If you leave this processing option blank, the system uses the tax ID from the address book number of the company on the transaction to update the EIN in the 1099 workfiles.
If you want to combine suppliers, but the suppliers do not share the same tax ID, enter a 1 in this processing option to assign the tax ID from the Supplier Combining Address field in the 1099 workfiles to all of the related supplier records in the same workfiles.
If you leave this processing option blank, the system uses the tax ID for each supplier.
If you are combining suppliers to generate a 1099 return, enter a 1 in this processing option to update the following fields in the 1099 workfiles with information from corresponding fields of the Supplier Combining Address record:
Search Type (AT1)
AR/AP Netting Flag (AT2)
Address Type 2 through Address Type 5 (AT3 - AT5)
Category Codes
This ensures that the information the system might use for reporting is current and consistent in the workfiles for all supplier records it uses for combining. Also, if you need to make any changes, you need to change only the combining supplier record (address book number of SCMB) and not all of the related address book records.
If you leave this processing option blank, the system uses the address book information from the individual supplier record.
There are some types of payments that you need to report only if they exceed the minimum amount established by the IRS. For your convenience, these amounts are pre-set in these processing options that JD Edwards World includes with the 1099 software. However, you should verify the values in the Minimum Amount processing options meet the current year IRS requirements.
IRS regulations require you to file 1099 information if you withheld any federal income tax for a supplier. To comply with the regulation, the Write Media program disregards all minimum amounts if the following boxes contain an amount:
1099-MISC, Box 4 (Federal income tax withheld)
1099-DIV, Box 4 (Federal income tax withheld) or Box 7 (Foreign tax paid)
1099-INT, Box 4 (Federal income tax withheld) or Box 6 (Foreign tax paid)
Use this processing option to specify a minimum total (aggregate) amount to use for comparison purposes against all of the minimum amounts specified for the individual boxes on the 1099-MISC form. Previously, the system considered only the minimum amount for an individual box to determine whether to issue a 1099 return.
For example, you specify 600 as the aggregate minimum amount, and you pay the following 1099 MISC reportable payment amounts:
A3 (Other Income) $500
A6 (Medical & health care payments) $400
A7 (Nonemployee compensation) $400
The system combines the amounts in all of the boxes on the 1099-MISC form and compares the total against 600. Although the payments do not meet the individual threshold for each type of reportable payment, the aggregate reportable amount exceeds $600, so the system generates a 1099 MISC form and includes the payments for all boxes.
If you specify an aggregate amount in this processing option, the system ignores all minimum amounts specified in the 1099 - Misc Minimum Amounts processing option. For example, if the supplier has been paid more than the minimum amount required to generate a 1099 for Royalties, which is $10.00, but does not exceed the aggregate you specify of $600, the system does not generate the 1099 for the Royalty payment.
If you do not specify an aggregate minimum amount, the system reports only those payments that meet or exceed the minimum amounts specified for each individual box.
Regardless of the aggregate or minimum amounts specified, if federal income tax has been withheld under the backup withholding rules (box 4), the system includes all reportable payments on the 1099-MISC form.
Caution:
Please consult your tax advisor to verify when to use the aggregate total versus the individual minimum amounts.Prior to starting the 1099 process for the current year, verify that you have a backup of last year's 1099 data in the event that the IRS performs an audit of your records.
See Appendix B, "Workfiles Generated During 1099 Processing"
After you back up your workfiles and before you begin processing 1099 returns for the current year, you must clear the appropriate workfiles for the 1099 method that you use. The system provides the following programs to remove data from your 1099 workfiles:
Clear A/P and G/L Workfile (J04CLRFP)
Purge 1099 Adjustments File (P00PURGE)
You run the 1099 - Clear A/P Workfile program (J04CLRFP) to delete the prior year records from the 1099 A/P Workfile (F045143) and 1099 G/L Workfile (F045141). Clearing the 1099 workfiles ensures that you do not combine prior year information with the current year information for 1099 reporting.
This program includes two processing options which allows you to clear one or both of the workfiles, so that you do not have to run the program twice. There are also two menu selections for J04CLRFP. Depending on which menu selection you choose, the appropriate processing option is set to clear the appropriate file.
From 1099 Advanced and Technical Operations (G0432), choose either Clear Entire G/L Workfile or Clear Entire A/P Workfile
See Section 8.1, "Clear Entire A/P Workfile and Clear Entire G/L Workfile (J04CLRFP)"
You run the Purge 1099 Adjustment File program (P00PURGE/ZJDE00048) to delete the prior year records from the 1099 Adjustment File (F045145). When you run version ZJDE0048 of the P00PURGE program, the system deletes the data in the F045145 file. You can set the processing options to:
Save the data in another library
Reorganize the purged F045145 file, which removes the space left by the records you purge, allowing for optimal performance.
Optionally, you can retain the F045145 file each year to use as an adjustment audit file. The system stores the 1099 reporting year in the Calendar Year (YR) field and selects only current 1099 reporting year adjustment records for processing the current year 1099 returns.
From1099 Advanced and Technical Operations (G0432), choose Purge 1099 Adjustment File