How to Process 1099s in Dynamics GP

If you are doing business in the Untied States, you may be required to track purchase amounts and issue 1099 Statements to certain Vendors and the IRS.

Dynamics GP allows you to set up and track 1099 Vendors, process and pay transactions with 1099 Amounts, adjust 1099 transaction values, and print 1099 Statements. Currently, Dynamics GP does not have functionality to electronic file Federal 1099s.

Depending on your current version, Dynamics GP supports the following 1099 Tax Types:

  • Dividend
  • Interest
  • Miscellaneous
  • Nonemployee compensation

With proper setup, Dynamics GP will record 1099 Amounts on individual transactions.

Yearly Vendor 1099 Totals are based on which of these transactions are paid during a calendar year.

This article will show you how to set up and track 1099 Vendors, how to enter, edit and correct various entries and transactions, and how to print 1099 Statements, as well as alternative 1099 reporting methods.

Table of Contents

Vendor Setup

Purchasing >> Cards >> Vendor >> Options

In order for Dynamics GP to track Vendor 1099 Amounts, the Vendor Card must be set up as required in the “Vendor Maintenance Options” window prior to transactions being entered and posted.

Tax Types

Depending on your Dynamics GP Version, you will have the following 1099 “Tax Type” options available:

  • Not a 1099 Vendor
  • Dividend
  • Interest
  • Miscellaneous
  • Nonemployee Compensation
Screenshot navigating to the Vendor Maintenance Options window, highlighting the "Tax Type" dropdown.

Tax ID

For US 1099 Vendors, enter the Vendor’s “Tax ID” number in the Vendor Maintenance Options window. This value will print on the Dynamics GP 1099 Statement.

This value can be added at any time prior to printing the Vendor 1099 Statements. This value is not tracked at the transaction level.

Screenshot in the Vendor Maintenance Options window highlighting "Tax ID".

Doing Business As (DBA)

A Vendor “DBA” (Doing Business As) field was added in Dynamics GP, 18.3 (October 2020 release).

Screenshot in the Vendore Maintenance Options window highlighting "DBA".

The DBA field, when populated, will print on the 1099 Statement in the “RECIPIENT’S name” box under the Vendor Check Name.

Screenshot of a 1099 Statement highlighting the "RECIPIENTS name" box.

Vendor 1099 Setup – SmartList

In the “SmartList >> Purchasing >> Vendor” report, you can create a listing of current Vendors that have been set up with the different 1099 “Tax Types”.

You will set the “Search” criteria as “1099 Type >> is not equal to >> Not a 1099 Vendor”.

Note: The default Vendor SmartList does not allow reporting on the 1099 Type “Box” value.

Screenshot navigating to SmartList, Purchasing, and Vendor, highlighting "Search Vendors" window search criteria.

Module Setup

Company Setup

Administration >> Setup >> Company >> Company

Enter your company’s Tax ID Number in the “Tax Registration” field in the “Company Setup” window. This value will be printed on the Vendor 1099 Statement.

Screenshot navigating to the Company Setup window in GP highlighting the Tax Registration number.

Payable Module Setup

Purchasing >> Setup >> Payables >> 1099 Setup

You can view and adjust 1099 Tax Type Descriptions and Minimum Amounts for each 1099 Tax Type.

Screenshot navigating to the 1099 Setup window highlighting the 1099 Tax Type Descriptions and Minimum Amounts.

Vendor Transaction Entry – 1099

Once a Vendor has been set up as a 1099 Vendor, when transactions are entered and posted, Dynamics GP will begin tracking 1099 Amounts for the following transaction types:

    • Payable Transaction Entry
    • Receiving Transaction Entry (Shipment/Invoice)
  • Purchasing Invoice Entry (Enter/Match Invoice)
  • Returns Transaction Entry

Payables Transaction Entry

Purchasing >> Transactions >> Transaction Entry

Screenshot navigating to the "Payables Transaction Entry" window. Indicating the 1099 Amount, "Payables 1099 Entry" window.

Receivings Transaction Entry

Purchasing >> Transactions >> Receiving Transaction Entry (Shipment/Invoice)

Screenshot navigating to the "Receivings Transaction Entry" window. Indicating to the settings found in the "Receivings 1099 Entry" window.

Purchasing Invoice Entry

Purchasing >> Transactions >> Enter/Match Invoices

Screenshot navigating to the "Purchasing Invoice Entry" window. Highlighting the "Purchasing Invoice 1099 Entry" settings for the 1099 Amount.

Returns Transaction Entry

Purchasing >> Transactions >> Returns Transaction Entry

Depending on the status of the Purchase Order, the “Returns w/Credit” Type will record 1099 Amounts.

Screenshot navigating to the "Returns Transaction Entry" window, highlighting the "Type" and the 1099 Amount.

Vendor 1099 Transaction – SmartList

In the “SmartList >> Purchasing >> Payable Transactions” report, you can create a listing of Vendor Transactions that have 1099 Amounts recorded.

You will set the “Search” criteria as “1099 Amount >> is not equal to >> 0” along with a desired date range restriction.

Note: The default Payable Transaction SmartList does not allow reporting on the 1099 Type “Box” value.

Screenshot navigating to "Payables Transactions" highlighting the "Search Payables Transactions" window search defition requirements.

Correcting Vendor Transactions – 1099

Dynamics GP provides two methods for correcting 1099 Amounts on transactions that have been posted in the system.

  1. Edit 1099 Transaction Information
  2. Update 1099 Information

Edit 1099 Transaction Information

Purchasing >> Transactions >> Edit 1099 Transaction Information

If your Vendor is currently set up as a 1099 Vendor, you can access that Vendor’s posted transactions in the “Edit Transaction Information” window and adjust “1099 Tax Type”, “1099 Box”, and “1099 Amount”, including setting as “Not a 1099 trx”.

The “Edit Transaction Information” window allows you to view transactions based on:

  • 1099 Debit Transactions (displays current debit transactions assigned with 1099 assigned)
  • All Debit Transactions (displays all current debit transactions with or without 1099 assigned)
  • All Credit Transactions (displays all current credit transactions with or without 1099 assigned)
Screenshot in the "Edit 1099 Transaction Information" window highlighting the "Vendor ID", "Include: 1099 Debit Transactions", "Tax Type", and "1099 Amount".

When you “Process” changes made in the “Edit Transaction Information” window, the transactional data in the Open and History tables are updated, and the “Update 1099 Information Audit Report” will be printed.

Screenshot in the "Edit 1099 Transaction Information" window pointing from the "Tax Type" to the "Process" icon. Screenshot of the "Update 1099 Information Audit Report".

Update 1099 Information

Purchasing >> Utilities >> Update 1099 Information

The second utility that can be used to modify Vendor 1099 setup and 1099 transaction details, is the “Update 1099 Information” utility.

This utility allows you to update multiple Vendors at one time by selecting ranges based on: “Vendor ID,” “Vendor Name,” “Vendor Class,” and “1099 Type”.

Note: Prior to selecting “Process,” make sure you have inserted a “Range Restriction,” so you are only affecting the Vendor(s) and Vendor transaction(s) desired.

It is recommended that a company database backup be performed prior to using this utility.

Update Selection Options:

  • Vendor: Will update the Vendor(s) Card setup.
  • 1099 Transactions: Will update 1099 Transaction(s) values.
  • Vendor and 1099 Transactions: Will update both the Vendor(s) Card setup and Vendor Transaction(s).
  • From: Select the current assigned 1099 Tax Type and 1099 Box Number to change.
  • To: Select the desired new 1099 Tax Type and 1099 Box Number.
  • Ranges: Enter a restriction of Vendor(s) to update.
Screenshot in the "Update 1099 Information" window highlighting the following fields: "Update: Vendor", "From", "To", and "Ranges".

In the example below, we are updating both the Vendor and Vendor Transactions from “Not a 1099 vendor” to “Nonemployee Compensation” for Vendor ID “LEAFFRIVE0001”.

Screenshot of both the "Vendor Maintenance Options" window and the"Update 1099 Information" window highlighint the "Tax Type" changing.

When you “Process” changes made in the “Update 1099 Information” window, the transactional data in the Open and History tables are updated and the “Update 1099 Information Audit Report” will be printed.

Screenshot of the "Update 1099 Information Audit Report".

Updating Summary Amounts – 1099

1099 Details

Purchasing >> Cards >> 1099 Details

If a Vendor Card is currently set up as a 1099 Vendor, you can access and adjust 1099 Amounts in the “1099 Details” window for specific month(s) and year(s).

When changes are made in the “1099 Details” window there is no transaction detail posted in the system supporting the 1099 Amount entered or removed.

See below for the effect if the “Reconcile Payables Accounts >> Calendar Year” process is run with “All Amounts” selected.

Screenshot of the "1099 Details" window pointing to the change in "Nonemployee Compensation".

Reconcile Payable Accounts

Purchasing >> Utilities >> Reconcile

If the “Reconcile Payables Accounts >> Calendar Year” process is run with the “All Amounts” selection marked, changes made in the “1099 Details” window will be lost because there is no transactional detail supporting the 1099 Amounts.

Screenshot in the "Reconcile Payables Accounts" window pointing from the "Process" icon to the popoup saying "Removing or not keeping transaction history for the selected year, or voiding a payment that crossed calendar years, may result in inaccurate summary records after reconciling. See the help for details. Do you want to continue?" Screenshot of the "Reconcile Period Balances Report", highlighting the 1099 Amount before and after reconciliation.

Printing Vendor 1099 Statements

Purchasing >> Routines >> Print 1099

In the “Print 1099” window, you can print the following:

  • 1099 Edit List
  • 1099 Statement Forms
  • 1096 Statement Form

1099 Edit List

In the “Print 1099” window, confirm the “1099 Year”, select the “1099 Type”, and then select the “Print” Icon to print the “1099 Edit List”.

Screenshot in the "Print 1099" window, highlighting the "1099 year" "1099 type" and print.

1099 Statement Forms

Depending on your Dynamics GP version, in the “Print 1099” window, you can print 1099 Statements for the following 1099 “Tax Types”:

  • Dividend
  • Interest
  • Miscellaneous
  • Nonemployee compensation

Depending on your Dynamics GP version, when selecting one of the 1099 “Tax Types” above, you have the following 1099 Statement form options to print:

  • Continuous (continuous paper feed, prints data onto preprinted forms)
  • Single Feed (single sheet paper feed, prints data onto preprinted forms)
  • One Wide with Box (prints 1099 Amounts and the 1099 Form)
Screenshot in the "Print 1099" window highlighting the "1099 Type" and "Form Type" dropdowns.

In the “Print 1099” window, confirm the “1099 Year”, select the “1099 Type”, select the desired “Form Type”, and then select the “Print Forms” Icon.

Example: “1099 Nonemployee Compensation” using “One Wide with Box”

Screenshot in the "Print 1099" window highlighint the "1099 Year", "1099 Type", and "Form Type" and point to the "Screen Output - 1099 NEC Copy B with Box" window.

Example: “1099 Nonemployee Compensation” using “Single Feed”

Note: Depending on your printer and printer driver, adjustments may need to be made to the text placement using Dynamics GP Report Writer.

Screenshot in the "Screen Output - 1099 Laser Nonemployee Compensation" widnow.

1096 Form

In the “Print 1099” window, confirm the “1099 Year”, select the “1099 Type”, select “1096 Form”, and then select the “Print Forms” Icon.

Note: Currently, Dynamics GP does not print the 1096 Form with the boxes. If you are not electronically filing 1099s, you will need to print onto a pre-printed 1096 From.

Depending on your printer and printer driver, adjustments may need to be made to the text placement using Dynamics GP Report Writer.

Example: “1099 Nonemployee Compensation”

Screenshot printing the 2096 form, highlighted in the "Print 1099" window.

Alternative 1099 Reporting

For assistance with any of the alternative reporting options listed below, please reach out to Encore Care to have a request ticket generated.

Modified 1099 Edit List

Using GP Report Writer, the “1099 Edit List” can be modified so all Vendor information is on one line, which is easier to read and can be saved as a .csv file and opened in Excel.

Default Format:

Screenshot of the default format for printed 1099s.

Modified Format:

Screenshot of a modified format printed 1099.

Microsoft 2023 Year-End 1099 SQL View for SmartList

In the Microsoft 1099 2023 Year-End blog, Microsoft Dynamics GP: 1099 Changes to expect -Get ready for Year-end 2023!!, Microsoft provided a SQL View that can be added to your system to facilitate Vendor 1099 reporting.

Screenshot of a 1099 SQL view.

Custom Payable Transaction SmartList

The “PayableTransaction” SQL View can be added to either SmartList Designer or eOne SmartList Builder to create a custom 1099 data views to help validate your Vendor/Transaction 1099 settings and values.

Note:

  • A restriction can be set at the report level to exclude “Payment” Document Types, since Payment transactions do not contain 1099 Amounts.
  • A restriction can be set at the report level to exclude “Voided” transactions.
  • The “1099 Type” field is the 1099 Type value assigned to the transaction.
  • The “1099 Box” field is the 1099 Box number assigned to the transaction.
Screenshot of the "SmartList Designer" window highlighting "Payables Transactions" Database View and the Filters applied.

Vendor 1099 and Transaction 1099 Settings Do Not Match

Enter a “Field Comparison” between “1099 Type from Vendor Master >> is not equal to >> 1099 Type”.

Screenshot of a "Field Comparison" highlighting "1099 Type from Vendor Master is not equal to 1099 Type".

Vendor Set as 1099 but Transaction 1099 Amount Is .00

Enter a restriction on the “1099 Type from Vendor Master >> is not equal to >> Not a 1099 Vendor”, and “1099 Amount >> is equal to >> 0”.

Screenshot of a Field Comparison "1099 Type form Vendor Master is not equal to Not a 1099 Vendor" and "1099 Amount is equal to 0".

Transaction Set as 1099 but 1099 Amount Is .00

Enter a restriction on the “1099 Type >> is not equal to >> Not a 1099 Vendor”, and “1099 Amount >> is equal to >> 0”.

Screenshot of a Field Comparison "1099 Type is not equal to Not a 1099 Vendor" and "1099 is equal to 0".

Confirming 1099 Amounts Using Date Invoice Paid Off

Using a date range restriction on the “Date Invoice Paid Off” field, the Apply Date, you can confirm the total of the “1099 Amount” field from the detailed transactions balance with the “1099 Edit List”.

Note: You will need to convert the Credit Memo/Return values to Negative or create a calculated filed on your SmartList report.

Screenshot highlighting the total 1099 Amount in the printed 1099.

For more information on managing 1099s in Dynamics GP, please reach out to us, we’d love to help.

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