12-a-003 - Procedures for filing 2011 Form 1099 Information Returns for non-SMART payments. (October 12, 2011) (Supersedes 11-A-005)

Summary of changes:

There are three changes to procedures for calendar year 2011 Form 1099 reporting for non-SMART payments submitted to the Office of General Services (formerly the Division of Accounts and Reports) for printing, mailing, and filing with the IRS:

1. The vendor/client must be in the SMART vendor table. 
2. All reportable payments must be submitted via the help desk using the EXCEL template referenced below
3. All payments reported through the Office of General Services will be processed through SMART.  Paper 1099s are generated and mailed to the vendors.  The 1099 information will be electronically submitted to the IRS. 

There is NO option for the agency to print the forms and have General Services report to the IRS.

Below are the revised policy and procedures.

While most 1099 transactions are recorded in the Statewide Management, Accounting and Reporting Tool (SMART), and require no additional action by state agencies; there are some payments that occur outside of SMART or the information to be reported to the IRS is not in SMART. These transactions result in unique reporting procedures comprised of the following:

• Locally administered interest payments of $10 or more are to be reported on IRS Form 1099-INT. These payments typically represent interest paid from trust funds to clients of institutions with the Department of Social and Rehabilitation Services and the Department of Corrections.
• State Fair premiums are to be reported on Form 1099-MISC.
• Other payments such as non-employee awards not paid directly to the recipient from SMART.
• Note that purchases of Real Property are now reported in SMART, and require the appropriate SMART preferences to record the appropriate data.

To report non-SMART payments for form 1099 purposes the agency will need to confirm the vendor is in the SMART vendor table with the appropriate 1099 type and class, and withholding is turned on.  If the vendor is not in the vendor table, the agency must add the vendor to SMART including the appropriate 1099 type and class, and turn withholding on.

Complete the attached EXCEL template PS_WTHD_TRAN_TBL_update_template for all non-SMART 1099 reportable payments.  The completed template needs to be received by the Office of General Services by January 13, 2012 to ensure the 1099s are distributed by the January 31, 2012 deadline.

The template has the columns listed below.   Do not insert or delete columns or rows. Do not change the formatting.  Beginning with line 2 (replacing the sample data), complete one line for each payment (add lines as necessary for additional withholding types/classes). The gray columns are defaults and should not be changed.  If 499 lines are not sufficient, copy line 500 down.  When completed, attach the EXCEL spreadsheet to a Help Ticket with the heading “non-SMART 1099”

BUSINESS_UNIT:  5 characters must have leading zeros (your agency number)

WTHD_ENTITY:  IRS

WTHD_TYPE:  as listed in the vendor table (1099, 1099I, 1099G, 1099D)

WTHD_JUR_CD:  FED

WTHD_CLASS:  as listed in the vendor table

WTHD_RULE:   RULE0

VENDOR_SETID: SOKID

VENDOR_ID:  10 digits with leading zeros, as assigned by SMART.

VNDR_LOC:  the vendor location with the appropriate 1099 type and class, usually 001.

ADDRESS_SEQ_NUM: 1  

PYMNT_ID:  Blank

VNDR_REGIST_ID:  SSN or FEIN, 9 digits including leading zeros

PYMNT_DT:   date of payment, mm/dd/yyyy format        

WTHD_DECL_DATE:  Same as date of payment

WTHD_BASIS_AMT:   The taxable amount for this 1099 type and class for 2012.

DESCR100:  100 characters of your choice – no punctuation, no special characters

Additional Resources:

PowerPoint review of setting up vendors for 1099 reporting and an account code guide: http://www.da.ks.gov/ar/forum/astra/mtg2011-05-1099s.ppt 

 IRS guide to each type of 1099, including the payments for each:
http://www.irs.gov/efile/article/0,,id=98114,00.html

Page 6 and 7 of the job aid “Create a 1099 Voucher” has Examples of payments by 1099 type and class:  http://www.da.ks.gov/smart/Training/JobAid_Create_1099Voucher_Online_20100630.doc

SMART withholding codes:  http://www.da.ks.gov/smart/Training/JobAid_WithholdingCodes_20100720.ppt

Attachment: IC 12-a-003 - PS WTHD TRAN TBL update template

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