Processing 1099s

SPECIAL NOTE:  If you have over 10 forms to file, you must submit them electronically to the IRS.
 
Use this task list as you complete each step. 

IRS Form 1099

DUE DATE: January 31st.
 
An IRS Form 1099 must be sent to all service non-incorporated entities that are paid $600 or more within the tax year.  It is not necessary to send a Form 1099 to an incorporated entity, however it was decided by the IALC to produce a Form 1099 for all whether they are incorporated or not.

• While the IRS only requires 1099s for non-corporate entities paid over $600, the IALC voted to produce a Form 1099 for ALL associates whether they are incorporated and/or if the associate was paid less than the 1099 minimum of $600. Due to this decision, the 1099 export from Command will include the 1099 amount for ALL associates, Outside Brokers and Co-Brokers. Any of these that you choose to exclude will need to be removed from the export file or from the 1099 preparation software/service. 
• AccountEdge produces the Form 1099 for all non-incorporated service vendors that are paid $600 or more within the tax year.  It is very important for the AccountEdge Vendor Card File – Buying Details to include the “Tax ID Number” and “Report Payments on 1099 as: Non-Employee Compensation.”  If you forgot to enter this information, you can do that before processing the 1099s and AccountEdge will immediately know to include the vendor when generating the 1099s.
• Profit Share Form 1099s are produced by KWR.  

1)  Preparation

1. Determine which service (or in house) system you will use to print your 1099's.
2. In the Accounting Applet in CommandMC, enter any necessary corrections, then export the Year End Close Overview report. 
3. If your Market Center has 10 or more 1099s to file, it is necessary for your Market Center to file Form 4419 “Application for Filing Information Returns Magnetically/Electronically” and the IRS will assign your Market Center a TCC number used during the electronic filing process.  If your Market Center obtained an IRS TCC number in a prior year you do not need to request this number again. Search the IRS website for a copy of this form (Form 4419). 
4. In AccountEdge, open the data file for the PYYY Fiscal Year named PYYYKWR_MC[MC#].MYO and click Setup – Company Information.  Make sure the Fiscal Year displayed in the lower-right is PYYY.  If it is not, please contact MCA Support by completing this form for assistance.
   
5. Click Setup - Payroll and 1099 Information and make sure that "The Current Payroll & 1099 Year" displayed is PYYY. You will not update the PYYYKWR_MC[MC#].myo file with the CYYY Tax Tables, however, you will need to have the most up-to-date PYYY tax tables loaded, even if your Market Center does not process payroll in house.
   
6. Click Command Centers - Purchases & Payables - Print 1099s and 1096s - select the desired form, federal tax ID and year - then click Ok.  Make sure that the correct “Federal Tax ID #” is displayed.  Print the AccountEdge 1099s to blank paper to be added into the Year End Close Overview report later.  When asked if you want to print the Form 1096, click ‘OK’.  Make sure the 1099s include all service vendor payments to non-incorporated entities that total $600.00 or more during PYYY; the IRS requires that a Form 1099 be issued for them.

2)  Year End Close Overview Report

1. In CommandMC, in the Accounting Applet, click “1099/T4 Reporting”.  
2. Review this list VERY carefully looking for incomplete information or obvious errors.  The IRS will fine you for incomplete Form 1099 information.  Enter corrections as necessary. 
   
   1. Confirm street addresses are complete.
      • Make sure all State 2-character abbreviations are correct.  Use this link: https://about.usps.com/who-we-are/postal-history/state-abbreviations.pdf to print a list of them.
      • Make sure all zip codes are correct.  Use this link, http://www.usps.com/zip4/welcome.htm?from=global&page=2132findzip, for an easy way to look up the Zip code for any address.
      • Make sure all street addresses are complete.
   2. If address changes are made to the associate or vendor record, these changes can be synced to the 1099/T4 applet by opening the 1099 record in the Accounting Applet, and clicking the sync button on the Details view
3. Once all necessary adjustments have been completed, click Export .csv on the dashboard to export the 1099 data. Once downloaded, this file is ready to be imported into the provider of your choice to produce, print and mail the 1099 forms.  

1099 Printing/Mailing 

Follow the directions of your 1099 service provider for uploading the data and preparing 1099's.
 

1)  Market Center Ownership Changes in PYYY

If your Market Center changed ownership in PYYY, and the 1099/T4 report was NOT run at the time of the ownership change, follow these instructions:

1. In Activity Reports in CommandMC, run a Closed Sales report. Filter the Closed Period to cover the date range in which the first owner owned the Market Center during the PPYY. Print the same report for the 2nd owner for the appropriate date range. 
2. Provide the first owner with a copy of their report so they can do 1099s for the time period in which they owned the Market Center.   Keep a copy of this report in your PYYY 1099 file for your records.
3. Using the report run in Step 1 for the 2nd or existing owner, in the Accounting Applet click on 1099/T4 Reporting and adjust the 1099 total by entering the appropriate negative amount for closings that occurred when the Market Center was owned by the previous owner, so that the “1099/T4 form amount” equals the amount shown on the DA List for the existing owner. For example:  The Associate Commission record shows $135,000 for the “F1099/T4 form amount” but the existing owner’s DA List shows $100,000.  Enter a -$35,000 in the Adjustment box so that the “1099/T4 form amount” displays the correct $100,000 amount.
   
   If the 1099/T4 report from the prior ownership was run at the time of the ownership change, use those amounts to adjust each agent's 1099 total by entering the appropriate negative amount for closings that occurred when the Market Center was owned by the previous owner, so that the "1099/T4 form amount" equals the amount of production under the new ownership. 
4. When all Associate records are corrected, print a "Year End Close Overview report” and carefully ensure that the report matches the existing owner’s DA List printed in Step 1.
   
   

2)  IRS Form W-2–US Only 

Preparation

For printing PYYY W-2’s, make sure you open the AccountEdge company data file for the PYYY Fiscal Year named PYYYKWR_MC[MC#].MYO.  Verify the fiscal year by clicking Setup – Company Information.  Make sure the Fiscal Year displayed in the lower-right is PYYY.  If it is not, please contact MCA Support by completing this form for assistance.

Follow the directions for printing W-2’s as documented by AccountEdge support in their knowledge base located at https://www.accountedge.com/knowledge-base/