FY 2011

INFORMATIONAL CIRCULAR NO. 11-A-001 Supersedes:10-A-001

DATE:	June 18, 2010
SUBJECT:	2011 Private Vehicle Mileage
EFFECTIVE DATE:	July 1 ,2010
APPROVAL:
SUMMARY:	FY 2011 Privately Owned Vehicle Mileage Reimbursement Rates

CONTACT: 

As authorized by K.S.A.75-3203a, the Secretary of Administration has fixed the private vehicle maximum mileage reimbursement rates for FY 2011 at:

34¢ per mile for privately owned motorcycle

50¢ per mile for privately owned automobile

$1.13 per mile for privately owned airplane (based on air miles rather than highway miles)

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DATE:	June 18, 2010
SUBJECT:	FY 2011 Subsistence Rates
EFFECTIVE DATE:	July 1, 2010
A & R CONTACT:	Shirley Gilchrist Ginnie Schirmer Lance Gagelman	(785) 296-2882 (785) 296-7021 (785) 296-2255	(shirley.gilchrist@da.ks.gov) (ginnie.schirmer@da.ks.gov) (lance.gagelman@da.ks.gov)
APPROVAL:
SUMMARY:	FY 2011 Meal Allowance and Lodging Rates

Please see Informational Circular 10-a-016 for information on the change in how meals are reimbursed.

As authorized by K.S.A.75-3207a, the Secretary of Administration has fixed the rates for FY 2011 at:

Meal Allowance:

*or actual not to exceed $91 per day
 

Reduced Meal Allowance:

If the cost of meals is included within the cost of registration fees or other fees and charges paid by the agency or supplied without cost by another party, the meal allowance should be reduced as shown in the table above.
 

Same Day Meal Allowance:

The rates as established in accordance with K.A.R. 1-16-18(c)(3) are the same as indicated in the table above.

Lodging Expense Limitations:

K.S.A. 75 3207a(f) provides that the daily lodging expense limitations established above may be exceeded by the lesser of either: (1) an additional 50% of the applicable lodging expense limitation, or (2) the actual lodging expense incurred.

These lodging limits continue to be applied to the lodging rate before taxes. Thus, the amount reimbursed or paid for lodging expenses may exceed the established lodging limitation by as much as the amount of associated taxes.

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The updated DA-184 Authorization for Direct Deposit of Employee Pay and/or Employee Travel is now available at http://www.da.ks.gov/ar/pm/forms/default.htm.

Agencies are encouraged to utilize the new combined form and to develop the appropriate business process flow within their agency to correctly route the information provided by an employee on the DA-184 form to all necessary parties for data entry and agency record-keeping. Direct deposit of employee payroll will be entered in the Statewide Human Resource and Payroll system and direct deposit of employee travel and expense is entered into the Statewide Management, Accounting, and Reporting Tool Travel and Expense module.

Please note the following:

• An employee may only select one account for SMART (travel and expense) and 100% of all travel and expense reimbursements will be deposited to that account.

• An employee may select up to a maximum of nine accounts for SHARP (employee payroll) and identify the account priority and the percentage or amount of net pay that is distributed to each account.

• The “International ACH Bank” checkbox is intended to be selected if the entire amount of the direct deposit to a specific account may result in the transfer of funds to a financial agency outside the U.S. The functionality to support the International ACH requirements is not yet in place so agencies should refrain from using this checkbox at this time. Additional instructions will be released when the necessary programming changes are made to implement International ACH payments.

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DATE:	October 14, 2010
SUBJECT:	IRS 1099 Reporting
EFFECTIVE DATE:	November 15, 2010.
CONTACT:	Randy Kennedy	(785) 296-4788	Randy.Kennedy@da.ks.gov)
APPROVAL:
SUMMARY:	IRS 1099 Miscellaneous Reporting – revocation of exceptions

The Department of Administration is responsible for issuing IRS 1099 forms for all agencies so that we can report as a single entity. While a single payment may not exceed the reporting threshold, we are required to aggregate all payments and report if the total payments exceed the IRS reporting threshold. In the past a limited number of exceptions have been granted to not collect recipient data for de minimis payments.

We have reviewed this exception process with our agency attorney. We have been advised there should not be any exception from collecting 1099 data regardless of payment amount. Any single payment when added to all other agency payments could result in the vendor’s payments exceeding the reporting threshold, no matter how small the individual payment. Therefore, effective November 15, 2010, all exceptions from collecting and reporting 1099 data are revoked.

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DATE:	December 16, 2010
SUBJECT:	Procedures for filing 2010 Form 1099 Information Returns
EFFECTIVE DATE:	Immediately
CONTACT:	Randy Kennedy	(785) 296-4788	Randy.Kennedy@da.ks.gov)
APPROVAL:
SUMMARY:	Procedures for Filing Calendar Year 2010 Form 1099 Information Returns

For calendar year 2010 1099 reporting data from STARS and SMART will be required.

1099 reporting for the State of Kansas is comprised of two processes, the first being the issuance of the 1099 to the payee with the second being the electronic filing of the 1099 informational returns with the Internal Revenue Service (IRS). While most 1099 transactions are recorded in the Statewide Management and Recording Tool (SMART), and require no additional action by state agencies; there are some payments that occur outside of SMART or STARS, or the information to be reported to the IRS is not in SMART or STARS. These transactions result in unique reporting procedures, and are comprised of the following:

• Locally administered interest payments exceeding $10 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.
• Purchases of real property, exceeding $600 are required to be reported on IRS Form 1099-S (Do not include rental or construction costs). Additional information required by this form includes a legal description or address of the property and the closing date of the purchase transaction.   If the transaction is post SMART, then SMART should be utilized to create these forms by properly completing the 1099 withholding on the payment voucher.   Whereas, STARS transactions (Jan. 1, 2010 – June 30, 2010) continue to require manual processing.
• State Fair premiums are to be reported on Form 1099-MISC.

Agencies which have the transactions discussed above are responsible for the preparation and delivery of the appropriate 1099 form to the payee prior to January 31, 2011. To meet this reporting requirement, agencies can prepare and mail their own 1099s, or if the Division of Accounts and Reports has provided this service in prior years for the agency, the agency can request the Division of Accounts and Reports to perform this service again this year. The Division of Accounts and Reports has provided this service in past years to the following agencies: Kansas Commission on Veteran’s Affairs (Veterans’ Home or Soldiers’ Home), Juvenile Justice Authority, SRS, Parsons State Hospital and Training Center, and Larned State Hospital. If the agencies listed wish for Accounts and Reports to provide this service for calendar year 2010 1099s, please contact Randy Kennedy to coordinate.

For agencies requesting Accounts and Reports to produce and mail the 1099s, agencies will need to prepare a text file, or Excel file, or DA-43. The file or listing needs to be received by the Division of Accounts and Reports by January 19, 2011 to ensure the 1099s are distributed by the January 31, 2011 deadline. Please indicate on the email or cover letter submitted with the electronic file or listing that the Division of Accounts and Reports produces the 1099s.

For those agencies preparing and mailing their own 1099s to payees, the procedures for handling 1099 information returns for calendar year 2010 are as follows:

• Prepare and deliver the appropriate 1099 form to the payees prior to January 31, 2011. Do not mail the 1099 forms directly to the IRS or to the Kansas Department of Revenue; the Division of Accounts and Reports will provide an electronic file containing the 1099 information to the federal and state taxing authorities. The payer's FEIN to use for the State of Kansas is 48-1124839.
• For STARS transactions (Jan. 1, 2010 – June 30, 2010), agencies reporting applicable purchases of real property may submit the IRS and /or the State of Kansas copies of the 1099-S forms to the Division of Accounts and Reports (at the address provided below), and Accounts and Reports will then submit this information to the taxing authorities.   SMART transactions should be recorded in SMART.
• If any agency finds it necessary to issue a corrected information return, the payee should be provided a copy as soon as possible. The IRS copy of the corrected form (marked "corrected") should be forwarded promptly to the Division of Accounts and Reports (at the address provided below.

Since the State of Kansas is classified as a single payer entity by the IRS (all payments by state agencies are reported under one FEIN) and federal law and regulations require the filing of 1099 information returns by magnetic media or electronically, it is the responsibility of the Division of Accounts and Reports to transmit all 2010 calendar year 1099 informational returns to the IRS electronically. To aid the Division of Accounts and Reports with the electronic filing requirements, agencies reporting the expenditures discussed above, and with fewer than 20 records, may use the DA-43 form (http://www.da.ks.gov/ar/forms/ ), or may submit a text file, or may submit an Excel file. If you have 20 or more records, please submit the records in a text file or in an Excel file following the format shown in the attached NON-STARS 1099 Record Layout form. All electronic files or listings for ‘1099 information reporting only’ need to be received by February 8, 2011. Please email all electronic files to Randy.Kennedy@da.ks.gov, and mail any paper listings to:

Division of Accounts and Reports
Central Responsibilities Team
900 SW Jackson, Room 351-S, LSOB
Topeka, Kansas 66612-1248

Attention: Randy Kennedy

Please note that the February 8, 2011 deadline is only available to those agencies that prepare and mail their own 1099s, and the Division of Accounts and Reports just files the informational return with the IRS. If the Division of Accounts and Reports produces and sends the 1099s for the agency, the January 17, 2011 deadline is applicable.

When submitting data via a text or Excel file, please be sure to follow the formatting instructions, which include:

No hyphens or dashes in the Vendor Number field, entry is the nine digit FEIN or SSN,

Record and capitalize the first name, middle initial, last name in the Name field (example, JOHN C SMITH). Do not include forms of address (Mr., Ms., etc), or punctuation (i.e. periods or commas), or any other special characters.

No hyphens or dashes in the Zip Code field, just report the five (left justify) or nine digit 
zip code, (i.e. 66612-1248 would be reported as 666121248).

No dollar signs or decimals, in the amount field, just report the amount (i.e. 
$3,312.48 would be reported as 000000331248).

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Attachment: 1099 FORMATS - 1099 RECORD LAYOUT xls

DATE:	December 27, 2010
SUBJECT:	Procedures for correcting 2010 1099 Reporting
EFFECTIVE DATE:	Immediately
CONTACT:	Randy Kennedy	(785) 296-4788	Randy.Kennedy@da.ks.gov)
APPROVAL:
SUMMARY:	Procedures for correcting IRS 1099 reporting for calendar year 2010

In STARS agencies submitted journal vouchers to correct or charge reportable transactions to the FEIN of the entity that is subject to IRS 1099 reporting for Imprest Funds, Petty Cash Funds, and other payments where the payee was not recorded appropriately or at all in the accounting system.

In SMART the agency can use the existing SMART Imprest Fund and Petty Cash bank functionality to record these entries.  P-Card 1099 reporting for calendar year 2010 is performed centrally based on information received from UMB – no action is taken by the agency unless they are seeking to recognize 1099 reporting for items such as reportable awards. 

If your agency has processed transactions where the proper 1099 reporting information was not recorded in SMART or STARS, please submit the information on the EXCEL form available at the link below.  No reversal entries in SMART are necessary, unless the payment was marked reportable to the wrong entity or individual.  For example, if 1099 reportable awards were purchased from an Imprest Fund (not using SMART imprest fund vouchers) there would only be one correction line per award.

SMART 1099 Correction Form

All non-numeric fields must be completed in CAPS.  The TIN (taxpayer identification number), Vendor ID, and Zip Code must be completed as text with all leading zeros, no hyphens, no dashes, no commas, no special characters.  The vendor MUST be set up in SMART. All fields must be completed.  The 1099 types and classes are listed on the 1099 TAB.

The completed form must be sent securely, therefore send an e-mail to Randy.Kennedy@da.ks.gov by January 10, 2011, indicating you have a 1099 correction to submit.  He will send you a secure message via Tumbleweed.  Reply in Tumbleweed attaching the completed EXCEL file.

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Attachment: SMART 1099 Correction Form xls

DATE:	April 21, 2011
SUBJECT:	Addition of New Expenditure Account Codes
EFFECTIVE DATE:	July 1, 2011
CONTACT:	Martin Eckhardt Gail Barnhart	(785) 296-2661 (785) 296-3404	(Martin.Eckhardt@da.ks.gov) (Gail.Barnhart@da.ks.gov)
APPROVAL:
SUMMARY:	Addition of New Account Codes 527201, 527202, 527970, 527980

For central reporting purposes, the following new expenditure account codes have been established in SMART effective July 1, 2011:

• 527201              Assigned Counsel-Contract Lawyers
• 527202              Assigned Counsel-Non-Contract Lawyers

Also effective July 1, 2011, the following new expenditure account codes have been established in SMART to segregate Expert Witness Fees and Court Reporting Fees from expenditure account code 527990 “Other Professional Fees”: 

• 527970              Expert Witness Fees
• 527980              Court Reporting Fees

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