1. Minimizing Risk with the IRS: 1099 Reporting Best Practices Zubin Gidwani, Dynamic Budgets

2. #GPUGsummit Who is Zubin? – Former GP customer/end user Assistant Controller & Financial Systems Manager for public Company Maui Land & Pineapple Company – Tired of banging head into desk trying to manually manage 600+ department budgets, prototyped a solution after Microsoft announced the end of Forecaster, launched Dynamic Budgets in 2010. – Active w/ GPUG since inception (2007) – Former member of the GPUG Board of Advisors – Content Steering Committee for Microsoft Convergence and GPUG Summit – Inaugural GPUG ‘All-Star Award’ recipient (Nov 2011) – Implemented GP for GPUG, consulted on their website, developed Share My Code – Microsoft Certified Professional 2004 – Dynamics World - Top 50 Add On Products 2013

3. #GPUGsummit Poll Question 1: How do you look in the first week of January Tins Matched waiting for AP to close AP Closed waiting for extract Data Transferred to Print House My reservation with the Print House is Jan 27, quit bugging me so I can get the job done…

4. #GPUGsummit Agenda Understanding how GP records 1099 amounts Researching and validating 1099 data How to edit 1099 data TIN Matching 3 approaches to managing 1099s Printing / Filing Q & A

5. #GPUGsummit Understanding how GP records 1099 amounts

6. #GPUGsummit 1099 specification is pulled from the Vendor Card at transaction entry time From the Vendor Card you go into Options to view the Tax Type and 1099 Box

7. #GPUGsummit During invoice entry your AP staff can override the transaction amount subject to 1099 tracking

8. #GPUGsummit Why would a 1099 Summary be wrong? 1099 amounts are stored in the vendor summary records Each transaction post updates the 1099 YTD value in the Vendor Summary. Changes to a vendor’s “1099 Type”are not automatically retro- active, they will only impact future transactions.

9. #GPUGsummit How correct vendor 1099 Amounts Prior to GP 2010 : Professional Services Tool Library (PSTL) Edit 1099 type and update Recalculate YTD amounts (all or nothing) GP 2010 –1099 Details or Update 1099 Information Can filter to ranges of vendors, updates YTD Summaries GP 2013 – edit 1099 transactions Can specify 1099 details by transaction

10. #GPUGsummit Editing 1099 in GP2010 or earlier Professional Services Tool Library – (Legacy discontinued tool…) The PSTL 1099 modifier is an All or Nothing utility: re-calculates 1099 applied amounts for all vendors, all transactions where differences in 1099 eligibility is detected.

11. #GPUGsummit Editing 1099 Data in GP2010 or later versions Tools -> Utilities -> Purchasing -> Update 1099 information Expanded functionality from PSTL. Not only recalculates 1099 summary amounts for the YTD transactions, but allows one to edit the 1099 Tax type info simultaneously. All or nothing from the year perspective.

12. #GPUGsummit GP2010 – Single Vendor Edits Edit 1099 Details New functionality introduced to allow users to manually edit particular Vendor’s tax type and edit or redistribute 1099 amounts per 1099 Box. To view & Edit 1099 Details Cards -> Purchasing -> 1099 Detail To view 1099 Details Inquiry: Inquiry -> Purchasing -> Vendor 1099 Details

13. #GPUGsummit Enhanced Edit 1099 functionality in GP 2013 In GP 2013 you can edit individual vendor transactions (tax type, 1099 Box, and 1099 amount). *Note that these edits can be overridden with changes from the 1099 Details edit window.

14. #GPUGsummit How to Print the 1096 Form In Microsoft Dynamics GP2013, you can print the 1096 summary form in addition to printing the 1099 forms. The 1096 information can be printed on a pre-printed form for the 1099 Miscellaneous, 1099 Dividend and 1099 Interest tax types. There is also a 1096 SQL Reporting Services Report that is similar to the IRS report layout that you can use for informational purposes only. In Print 1099, mark to print the 1096 after you’ve printed your 1099’s for the tax type. Microsoft Dynamics GP will print on the preprinted form and mark the correct box for each tax type In GP 2010 and earlier versions New Feature In GP 2013

15. #GPUGsummit Researching and validating 1099 data Recipients (start with Smartlists) – Addresses – Formal Name per IRS records – TaxID Box Types 1099 vs non-1099 qualified payments to 1099-vendors

16. #GPUGsummit If you don’t “Trust” your 1099 summaries, you can review transaction summaries with the following SQL Query Disclaimer: SQL Scripts can damage or destroy data. Use these scripts with caution on a test system first. Backup your database before using. Use the following script is at your own risk. We take no responsibility for any harm or data loss caused by these scripts nor do we warranty the validity of the results. The script is provided to assist your 1099 research activities, and must be independently validated against core system reports should you attempt to use these for final data extraction. Compare Transaction Summaries to 1099 Amounts

17. #GPUGsummit SELECT TOP (100) PERCENT CAST(DB_NAME() AS char(5)) AS CompanyDB, dbo.PM30200.VENDORID, SUM(dbo.PM30200.DOCAMNT) AS SumOfDOCAMNT, dbo.PM00200.VNDCHKNM, dbo.PM00200.ADDRESS1, dbo.PM00200.ADDRESS2, dbo.PM00200.CITY, dbo.PM00200.STATE, dbo.PM00200.ZIPCODE, dbo.PM00200.PHNUMBR1,dbo.PM00200.TXIDNMBR, dbo.PM00200.VENDSTTS, dbo.PM00200.TEN99TYPE, SUM(dbo.CM20200.TRXAMNT) AS SumofTrxAmt, dbo.CM20200.CHEKBKID, dbo.PM00200.USERDEF1 FROM dbo.CM20200 INNER JOIN dbo.PM30200 ON dbo.CM20200.CMTrxNum = dbo.PM30200.DOCNUMBR AND dbo.CM20200.CHEKBKID = dbo.PM30200.CHEKBKID INNER JOIN dbo.PM00200 ON dbo.PM30200.VENDORID = dbo.PM00200.VENDORID WHERE (dbo.PM30200.DOCDATE > CONVERT(DATETIME, '2009-12-31 00:00:00', 102)) AND (dbo.PM30200.DOCDATE < CONVERT(DATETIME, '2011-01-01 00:00:00', 102)) AND (dbo.PM30200.VOIDED = 0) AND (dbo.CM20200.VOIDED = 0) GROUP BY dbo.PM30200.VENDORID, dbo.PM00200.VNDCHKNM, dbo.PM00200.ADDRESS1, dbo.PM00200.ADDRESS2, dbo.PM00200.CITY, dbo.PM00200.STATE, dbo.PM00200.ZIPCODE, dbo.PM00200.PHNUMBR1, dbo.PM00200.TXIDNMBR, dbo.PM00200.VENDSTTS, dbo.PM00200.TEN99TYPE, dbo.CM20200.CHEKBKID, dbo.PM00200.USERDEF1 HAVING (dbo.PM00200.TEN99TYPE > 1) AND (SUM(dbo.PM30200.DOCAMNT) >= 600) ORDER BY dbo.PM30200.VENDORID (TEN99Type>1 will exclude “not 1099” vendors) Sample SQL Query for 1099 amounts based upon Payables Transactions Available on Share My Code (http//dyndir.com)

18. #GPUGsummit Best Practices: Tin Matching As Part of your Vendor Maintenance: Perform Tin Matching as part of the New vendor creation process “Offer” to withhold payment until correct information is submitted and validated Near final bulk TIN match in December – Double Check record validity – Validate EIN vs. SSN number format – Review for appropriate box types (rent, medical) – Reminder: Box 14 Gross Proceeds paid to an attorney is for legal settlements only. Legal Services are recorded under Box 7 non-employee compensation

19. #GPUGsummit Why Tin Match Requirement for Payer To Secure a TIN Initial solicitation - for all payees, you must make the initial solicitation when the payee opens an account or when the transaction occurs using Form W-9 to request the taxpayer identification number. The CP2100 or CP2100A Notice CP2100 and CP2100A notices are notices that inform a payer that he or she may be responsible for backup withholding. This may be due to missing or potentially incorrect taxpayer identification numbers identified during the processing of Form 1099 information returns. It is accompanied by a listing of missing, incorrect, and/or not currently issued payee TIN. Large volume filers (250 or more erroneous documents) receive the CP2100 notice, while all other filers receive the CP2100A notice. Payers face potential fines of $100 per each 1099 filing with a missing or invalid TIN "B" Notice If the IRS sends you a "B" notice indicating an incorrect payee TIN, you are required to backup withhold28% from a payee no later than 30 days after receipt. Backup withholding until the payee furnishes a TIN and certifies that it is correct.

20. #GPUGsummit IRS Tin Matching Various 3 rd parties will submit on your behalf (~$135 for up to 100,000 records) Free through IRS e-services – Program Summary http://www.irs.gov/govt/tribes/article/0,,id=131207,00.html – TIN Matching tutorial https://la2.www4.irs.gov/PeopleBooks/CRMPROD/Training/3pdev/3ptin/tinbulk1.htm Required IRS e-services Personal Registration Information – Legal name (verified with IRS & SSA records) – Social Security Number (verified with SSA records) – Date of birth (verified with SSA records) – Telephone number, E-mail address – Adjusted Gross Income (AGI) from either your current year or prior year filed tax return (verified from IRS records) – Home mailing address (verified from IRS records). If you have moved since you last transacted with the IRS, please update your information when registering.

21. #GPUGsummit TIN Matching The TIN Matching e-services allow “authorized payers” the opportunity to match 1099 payee information against IRS records prior to filing information returns. An authorized payer is one who has filed information returns with the IRS in at least one of the two past tax years. Interactive TIN Matching will accept up to 25 payee TIN/Name combinations on- screen Bulk TIN Matching will allow up to 100,000 payee TIN/Name combinations to be matched via a text file submission. Both programs will: Match the payee with W-9 name and TIN with IRS records; Decrease backup withholding and penalty notices; Reduce the error rate in TIN validation. The TIN Matching system is accessible 24 hours a day, 7 days a week.

22. #GPUGsummit TIN Matching Results Tin1 Name 1 Tin2 Name 2 Tin3 Name 3 Tin4 Name 4

23. #GPUGsummit The only TIN Match solution built specifically for Dynamics GP… The Validator1099 automates the process of validating TIN’s for expedited and accurate 1099 processing. Automatically perform a three way comparison between GP vendor data and current government/IRS data. Automatically identify whether or not vendors provided erroneous TIN’s, false names, bad addresses or has relocated, changed names or started-up under a new TIN. Catch the issues early and minimize, if not eliminate, your risk in reporting bad information to the government. OVERVIEW

24. #GPUGsummit 3 Methods for 1099 Reporting 1.Native Dynamics GP Printing & manual filing 2.Greenshades –GP integrated software with service bureau offering 3.1099Pro – stand-alone software with service bureau offering

25. #GPUGsummit Native Dynamics GP 1099 Process Allows you to print 1099s for recipients Does not generate the Federal summary report, it has to be manually created, it isn’t created in GP…. Must manage filing or efiling process on your own

26. #GPUGsummit Printing 1099 To Print: Tools-> Routines -> Purchasing -> Print 1099 Enter your Company information to be printed You can print all Vendors or enter a range Print option for printing an alignment only form

27. #GPUGsummit Adjusting the 1099 Form If the form alignment does not match your forms you will need to print to screen and edit in report writer. From the screen shot of the alignment form Click ‘Modify’ Once changes are made File->GP will return you to GP

28. #GPUGsummit Look for changes in forms with GP software updates For the 2010 year end, an updated 1099-INT form was released introducing a new box 10, and changing the positioning of boxes 8/9. Such changes are typical each year, so be sure to refer to Year End updates to ensure your program is up to date: Sample Links: GP2010 Year End Update https://mbs.microsoft.com/customersource/downloads/taxupdates/usgpye2010.ht m?printpage=false&stext=2010 1099-INT GP10 Year End Update https://mbs.microsoft.com/customersource/downloads/taxupdates/usgpye10.htm? printpage=false&stext=2010 1099-INT GP9 Year End Update https://mbs.microsoft.com/customersource/downloads/taxupdates/usgpye9.htm?pr intpage=false&stext=2010 1099-INT

29. #GPUGsummit Greenshades http://www.greenshades.com An integrated GP Module for W2 and 1099 printing and efiling

30. #GPUGsummit Year End Forms Printing Prints recipient copies of Federal W-2 and Federal 1099s directly to Blank Paper Perforated Paper and Envelopes available Print all forms, single form, or range of forms – www.downloadmyform.com www.downloadmyform.com Search information on forms to print Secure administrator controls over all functionality Single source management of forms distribution, corrections and changes Full reporting functionality including: – Employee requested changes – Print history – Electronic filing confirmations – Totals by company, state, dept or many more

31. #GPUGsummit New Annual Filing Screen

32. #GPUGsummit New Company Information Screen

33. #GPUGsummit New Options For 1099 Types

34. #GPUGsummit New 1099 Options Screen

35. #GPUGsummit New 1099 Options Screen New Running Totals!

36. #GPUGsummit New Excel Export/Import Screen

37. #GPUGsummit New Excel Export/Import Screen Exporting the data gets you a nice excel document that you can edit and save. Then you can reimport the changes. Templates exist for each 1099 type.

38. #GPUGsummit New Excel Export/Import Screen If you import an excel file that is missing required data an error message will display.

39. #GPUGsummit Filter 1099 Information Screen This screen will only appear if you have to report the following data elements: 1. Need to report more payments. Such as, vendors that fall under that IRS minimum payment threshold. 2. Need to combine vendors with the same EIN/SSN.

40. #GPUGsummit Forms Editing Edit Form Information in Visual Forms Viewer Error Checking and Auto-Summing Fields

41. #GPUGsummit Recipient Distribution Offer electronic reprints available directly from a recipients home/office computer Print, Edit, and Re-issue easily Perforated Paper and Envelopes available Mail Service – Printing, stuffing, and mailing – Includes postage for as low as $1.05 per form

42. #GPUGsummit Employee Access Screen

43. #GPUGsummit 1099Pro http://www.1099pro.com Stand-alone software alternative Allows you to print on plain paper Turnkey Service Bureau offering Web presentment SAS 70 certified (if you have SOX/IT/Audit requirements)

44. #GPUGsummit

45. 1099Pro Import Template (tab delimited files from Excel) Rcp TIN Last Name/Company First Name Name Line 2 Address Type Address Deliv/Street Address Apt/Suite City State Zip Country Rcp Account 2nd TIN notice Box 1 amount Box 2 amount Box 3 amount Box 4 amount Box 5 amount Box 6 amount Box 7 amount Box 8 amount Box 9 checkbox Box 10 amount Box 13 amount Box 14 amount Box 15a amount Box 15b amount Box 16 amount Box 17 ID number Box 17 state Box 18 amount Opt Rcp Text Line 1 Opt Rcp Text Line 2 Form Category Form Source Tax State

46. #GPUGsummit 1099Pro Software Interface Recipient Information concealed for confidenti ality in this presentatio n

47. #GPUGsummit 1099Pro form edit screen

48. #GPUGsummit Q & A

49. #GPUGsummit Dynamics GP enhancement requests Submit your feedback directly via the connect URL (left) or from the Communities Portal, Resources > Product Suggestions 1.Add Federal Summary Report to support 941 filings 2.Explore eFiling possibility 3.Other? https://connect.microsoft.com/

50. #GPUGsummit Questions? Zubin Gidwani Dynamic Budgets zgidwani@dynamicbudgets.com 650-332-6651