1099-Misc Reporting

This document shows step by step process for executing 1099 Misc Reporting

What is 1099 MISC report?

• In USA, 1099-MISC is used to report payments for services performed for a business by people not treated as its employees, such as payments to subcontractors, rent payments or prizes.

Business Requirement

• This is a requirement by Internal Revenue Service (IRS). A 1099-MISC form must be provided to the recipient and a copy mailed to or e-filed with the IRS.
• Any business that has paid vendor $600 USD or more as a non-employee, or at least $10 USD in royalties, must provide with a 1099-MISC.
• Copy A of the 1099-MISC form is intended for the IRS. It must be filed by February 28, if sending the form by mail. If it is filed electronically, the last date is March 31.
• Copy B is sent to the vendor for whom reporting to the IRS by January 31.

Prerequisites:

• Maintain field “Tax Number 1” with Social Security Number(SSN) in Control Tab of Vendor master data as per the below screenshot.
• Maintain Field “Tax Number 2” with Employer Identification Number (EIN) in Control Tab of Vendor Master data as per the below screenshot.
• Maintain “W. Tax Code” in Accounting information Tab of Vendor Master Data as per the below screenshot.

Maintain Social Security Number(SSN) and Employer Identification Number(EIN)  in Vendor Master.

Transaction Code: FK02

Maintain Social Security Number for Tax number 1 OR

Employer Identification Number for Tax number 2 in Tax Information tab of vendor master.

Press Enter.

Maintain Withholding Tax Code 07 for Non employee compensation.

Different WT Codes for 1099 reporting.

Post FI Vendor Invoice.

Transaction Code: FB60

1. Simulate.

Save the Screen.

Display Posted Document.

Transaction Code: FB03

Double click on vendor line item.

1. W. tax base amount and Tax Code have been updated at vendor line item level.

Post Outgoing Payment.

Transaction Code: F-53

Click on “Process Open Items” Tab.

Simulate and Save the Screen.

Execute Withholding Tax Report for 1099.

Transaction Code: S_PL0_09000314 (Withholding Tax Report for 1099MISC)

Execute.

Summary of vendors with 1099 amounts will get displayed as below.

(Note: If vendor master is not filled with Tax Number 1/SSN then program neither list the vendor details in the below report nor prints the form).

Click on Line item Icon.

Generic 1099 Reprot (S_P00_07000134)

Execute.

Enter.

I am also looking forward your suggestion if I missed out anything.