Understanding the G/L Method

The General Ledger (G/L) method generates 1099 returns based on information that is stored in the Account Ledger table (F0911). The G/L method looks only at the vouchers that were paid during the 1099 processing year. It uses automatic accounting instructions (AAIs) to determine which G/L object accounts on voucher expense distributions must be included in the 1099 processing. The AAIs specify the form and box where the amounts in each object account will be reported.

The advantage of using the G/L method is that to exclude expenses that you do not need to report, (such as freight charges) you do not have to create individual pay items on vouchers or adjust for such expenses in the 1099 A/P Worktable (F045143).

Consider using the G/L method when one or more of these conditions exist:

• The information in the F0911 table is complete for the 1099 reporting year.

• Payments to suppliers must be reported in more than one box on 1099 forms. With the G/L method, you can easily distinguish the boxes using account numbers AAIs.

• The company chart of accounts is stable.

• Many of your expenses to suppliers are exempt and must not be reported on 1099 forms.

  Do not use the G/L method if you use retainage. With retainage, you must use the A/P method.

  See Understanding 1099 Processing, Methods for 1099 Processing, Method Used with Retainage.

  Important: If you use the G/L method, do not purge the journal entries for the calendar year that you are reporting. You must have information in the F0911 table for all journal entries that involve payments in the calendar year for which a 1099 return is required.