Combining 1099 Information Among Suppliers and Companies
If you have several suppliers owned by a single company (or legal entity) that share the same tax ID, you must prepare a 1099 return for the legal entity, not for the individual suppliers.
For example, Johnson's Painting Specialist (supplier 5872) owns Johnson's Freezing Specialists (supplier 1862542). Although you made payments to both suppliers, you must create a 1099 return only for the legal entity, Johnson's Painting Specialist.
Similarly, if your company (or legal entity) owns other companies, or if you have companies set up that share the same EIN, you must combine the amounts that the individual companies (payers) paid to the same supplier on one 1099 return.
For example, Smith Construction Company (your company) owns Johnson Fabrications Incorporated (another company). Each company made payments to the supplier, Marshall Electrical Systems. When you process 1099s, you must generate the return only for the legal entity, Smith Construction Company.
When the systems detects duplicate supplier tax IDs or duplicate company EINs, it automatically combines 1099 information among those address book records, and retrieves the name and mailing address to use from the record with the lowest address book number in the 1099 Combined Workfile (F04515):
For example, if suppliers 1001, 1002, and 1003 all share the same tax ID, the system retrieves the mailing name and address from supplier 1001 and prints it as the payee on the 1099 form.
For example, if company 100, 200, and 300 all share the same EIN, the system retrieves the mailing name and address from company 100 and prints it as the payor on the 1099 form.
To direct the system to retrieve the mailing name and address from a supplier or company that does not have the lowest address book number, you must create a relationship among the multiple address book records.
You also set up this relationship when you have suppliers and companies that you want to combine that do not share the same tax ID.
The process to set up the system to combine information for suppliers and companies is the same:
You decide which supplier or company that you want to use as the reporting entity.
You decide which related code you want to use for both suppliers and companies and set it up in UDC 01/RA, if necessary.
You assign a code and the address book number of the reporting entity to the related address book records using the Related Addresses program (P01017).
You assign the same code to the Alternate/Related Address Combining processing option in the 1099 Processing Option Setup program (P04510STUP).
Optionally, if you are combining address book records that have different tax IDs, you can set a processing option in P04510STUP that allows you to use the tax ID of the reporting entity for all combined records. This is extremely helpful if you have numerous companies that must report under a single EIN.
After you assign the related address code to the suppliers or companies for whom you are combining returns, you need to verify that this value is also in the Alternate/Related Address Combining processing option in the 1099 Processing Option Setup program (P04510STUP). See Reviewing 1099 Processing Option Setup (P04510STUP) for more information.
The following task illustrates how to set up the related code and address book number of the legal entity for supplier 1862542.
Combining 1099 Information Among Suppliers and Companies includes the following tasks:
Assigning the Related Code for Combining
Setting the Processing Options for the 1099 Processing Option Setup Program
Assigning the Related Code for Combining
You must decide which code to assign to the related address book records of the reporting entity. You can use any code that is set up in UDC table 01/RA or you can set up a new code.
If you are combining records for suppliers and companies, you must designate and use the same related address code consistently on all related address book records for the system to combine supplier payments and company records properly. For example, if you use the Related Address Code of 2 to combine suppliers, you must also use the code of 2 to combine companies.
Navigation
From Auxiliary Address Book Information (G01111), choose Related Addresses
On Related Addresses, locate a supplier or company.
Enter a value from UDC 01/RA in the RA field.
Enter the address book number of the reporting entity in the Related Address field and click Change.
Setting the Combining Processing Options in the 1099 Processing Option Setup Program
After you assign the related address code to the suppliers and companies for whom you are combining returns, you must review and update the corresponding processing options in the 1099 Processing Option Setup Program (P04510STUP).
Navigation
From Annual 1099 Setup (G0442), choose 1099 Processing Option Setup
Enter the related code that you chose for combining in the Address for Combining Under One Payer processing option.
Additionally, if you have companies or suppliers that do not share the same tax ID, you can specify the tax ID of the reporting entity in the appropriate Company/Supplier Address processing option.
See Reviewing 1099 Processing Option Setup (P04510STUP) for additional information.