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1099 Processing Under New IRS Guidelines

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1099 Processing Under New IRS Guidelines

Starting from the 2020 tax year, the IRS has released new guidelines for 1099 Processing. To read all about the changes to the guidelines, check out our Press Release posted late last year.

If you utilize SAP Business One, these changes affect your year-end activities and tax processing. So in this training session, Pioneer aims to provide SAP Business One users with understanding of the new IRS-mandated 1099 requirements and SAP adjustments needed to support those new requirements.

Review the training recording OnDemand here, or read on for the overview discussed below.

Agenda

In this training on the new 1099 Processing Guidelines, Pioneer’s Ben and Beth will cover the following topics:

  • Year End Activities Recap
  • New 1099 Requirements
  • 1099 Setup in SAP
  • 1099 Reports
  • Options for new 1099 Handling
  • Documentation
  • Q&A

Year End Activities Webinar Recap

First, Ben and Beth dive into a quick review of our final webinar of 2020: Year End Activities with SAP Business One. If you were unable to attend, or would simply like a refresher, that webinar overview and recording are available here:

IRS Mandated Changes for 1099s

Moving in to the main topic for this session, Ben and Beth explain the new changes that the IRS has mandated for the 1099s.

There were 3 main changes:

New 1099 NEC Form

1099 MISC Box Renumbering

New 1096 Cover Sheet Checkbox

*For full details on these changes, please see our 1099 Tax Filing Changes blog.

What Are Your Options?

Now that you know what the changes are, how do you move forward from here? What are your options?

Ben and Beth offer 3 main options:

  1. The SAP Hot-Fix
  2. To Modify Existing 1099 Layouts in SAP
  3. To Utilize SAP Reports and a 3rd Party Website

SAP Hot-Fix

The first option available to you comes from SAP’s quick-acting development team. Once the 1099 Processing Changes were brought to their attention, SAP worked to create a “Hot-Fix”. 

This Hot-Fix is made for the newest version of SAP Business One, version 10.0. Included in this Hot-Fix is the new 1099-NEC form with a layout to go with it, as well as an additional layout for the 1096 to check the appropriate box.

*NOTE: This Hot-Fix is only for version 10.0 and is expected to be released at the end of January.

Modifying Existing 1099 Layouts in SAP

Due to time concerns the above SAP Hot-Fix is not recommended for the 2020 tax filing season, so Ben continues on with a few more viable options. The first being to modify existing 1099 layouts in SAP.

With this fix you can keep all the data in B1 where it already is, and instead modify existing layouts and create new layouts that will pull the data in and print it out on the pre-printed forms from the IRS.

*This option, while doable, is still fairly time-consuming, so should be addressed as soon as possible.

Out of the Box 1099 Table:

Administration > Setup > Financials > 1099 Table

1099 Editing:

Financials > 1099 Editing

0:23:30

Jump here to see Ben give an in-depth explanation on how to Modify your Existing Layouts, and use the List of Layout sizes for each table HERE.

Utilizing SAP Reports and a 3rd Party Website

Moving on to the 3rd and final option, Ben explains how you can utilize your Out-Of-The-Box Reports from SAP along with a 3rd Party website/software to generate the forms you need.

0:28:40

Pioneer created a Query for this that should assist you in better pulling data from the system. It specifically helps pull additional data such as the Business Partner Address and Tax IDs! (Be sure to Compare the data from the Query with your OOTB Reports when generating the forms through the 3rd party website/software!)

An example of a 3rd Party Website that you may want to use is: tax1099.com (note: there is a small fee to utilize this website).

Out of the Box 1099 Reporting:

Financials > Financial Reports > Accounting > 1099/1096 Report

*This report can also be found under: Reports > Financials > Accounting > 1099/1096 Report

1099 Processing Documentation

1099 Processing Under New IRS Guidelines Resources

Looking for more information? Below are a few links carefully selected by our experts that should give you everything you need to know about 1099 Processing in SAP Business One Under the New IRS Guidelines. Feel free to browse our resources or check out our knowledgebase. If you have any questions about 1099 Processing with SAP Business One, or want to know how you can run your business better with SAP B1, reach out to us by phone 602-888-2100 or email info@pioneerb1.com.

1099 Processing Under New IRS Guidelines Presentation

1099 Processing Webinar on our Youtube Channel

1099 Processing Documentation

SAP Business One LinkedIn Tips and Tricks Group

Year-End in SAP Business One Blog

1099 Changes in 2020 Blog

Year-End Activities with SAP Business One Blog

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