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AP: Oracle Payables' Plans For 1099 Reporting in the Current Tax Year (Doc ID 209913.1)

Last updated on APRIL 05, 2021

Applies to:

Oracle Payables - Version 11.5.10.2 and later
Information in this document applies to any platform.

Details

Oracle Payable Plans For 1099 Reporting in the Current Tax Year

 

 

1099 Reporting for Tax Year 2020

 

Introduction

Form 1099-MISC is used for reporting certain payments like Rent, Royalties, Medical and healthcare payments and so on. Non-employee compensation (NEC) was reported in Box 7 of Form 1099-MISC till Tax Year 2019. Beginning from Tax Year 2020, non-employee compensation must be reported in Form 1099-NEC.

The separation of non-employee compensation into a new form allows taxpayers to adhere to the separate deadlines for Form 1099-NEC and Form 1099-MISC. Form 1099-NEC must be submitted before end of January while Form 1099-MISC can be submitted by end of February.

Along with the creation of a new Form 1099-NEC, IRS revised Form 1099-MISC and rearranged the boxes for reporting certain income.

This document discusses the changes in these forms and how it impacts the users of Payables.

Summary of Changes for Tax Year 2020

 

 

 

 

 

Enter transactions for Tax Year 2020

The process for entering invoices for 1099 reportable suppliers remains unchanged. You can specify the income tax type and income tax region on each applicable invoice distribution, or accept the default values from the supplier.

Note that there is no change in the income tax type codes. You can continue using the same codes as before. The amounts will be reported in the new positions as per the revised layout. So there is no impact on existing transactions.

 

Code

Description

Position

MISC1

Rent

Box 1

MISC2

Royalties

Box 2

MISC3

Other income

Box 3

MISC4

Federal income tax withheld

Box 4

MISC5

Fishing boat proceeds

Box 5

MISC6

Medical and health care payments

Box 6

MISC7

Non-employee compensation.

Reported in Form 1099-NEC from 2020.

MISC8

Payments in lieu of dividend or interest

Box 8

MISC9

Consumer Products for Resale.

Reported Box 7 from 2020.

MISC10

Crop Insurance Proceeds.

Reported in Box 9 from 2020

MISC13

Excess golden parachute payments

Box 13

MISC14

Gross proceeds paid to an attorney.

Reported in Box 10 from 2020.

MISC15a NT

Section 409A non-taxable deferrals.

Reported in Box 12 from 2020

MISC15a T

Section 409A taxable deferrals.

Reported in Box 12 from 2020

MISC15b

Nonqualified deferred compensation.

Reported in Box 14 from 2020 and included in Box 1 on 1099-NEC.

 

 

Generate 1099 Reports

1096 Form

The 1096 Form contains a summary of each 1099 return type submitted to IRS. Payables generates the report on a preformatted form from the Internal Revenue Service. The report includes a new parameter Return Type. Select the type of return to generate, MISC or NEC. To generate summary for Form 1099-MISC, select MISC. To generate summary for Form 1099-NEC, select NEC.

1099 Forms

The 1099 Forms report prints on preformatted forms from the Internal Revenue Service. This report includes the new parameter Return Type. Select MISC to print Form 1099-MISC and NEC to print Form 1099-NEC.

 

1099 Forms PDF Format

Oracle Payables includes a new template for Form 1099-NEC for the tax year 2020. Select the return type MISC and Layout Form 1099-MISC to print Form 1099-MISC. Select the return type NEC and Layout Form 1099-NEC to print Form 1099-NEC.

1099 Forms – Comma Delimited Format

There is no change in the existing columns of this report. So any integration with third party software is not affected. An additional column has been added at the end for reporting the withheld amount on NEC transactions.

You can refer to the user guide for the data elements and the order in which they are presented.

 

1099 Electronic Media

Following is the summary of changes for 1099 Electronic Media Report

 

 

 

 

NOTE: In the images in this document, user details / company name / address / email / telephone number represent a fictitious sample
(based upon made up data used in the Oracle Demo Vision instance). Any similarity to actual persons, living or dead, is purely coincidental and not
intended in any manner.

 

Please note there are other version of the 1099 MISC form

a. Copy 1 For State Tax Department
b. Copy 2 To be filed with recipient's state income tax return, when required.
c. Copy C For Payer

These are not not included as PDF's in the Payables application. Clients would need to get these forms
and load them into the printer and then run 1099 Forms program to print them out.

Instructions for the Copy B For Recipient form and the Copy C for Payer form can be found on the www.irs.gov website
They are not included in the note as they change periodically, so it's best to check the www.irs.gov website to get
the latest information and instructions.

Actions

 Final Consolidated Patches For 1099 Project 2020 has been released.

Release Patch
The 1099 Patches for 2020 are:
11i <Patch 32100730> and <Patch 32608654>

Note:  The 11i patch will be available to 11i clients who have purchased extended support.
12.0.x There is no 1099 patch for R12.0
12.1.x <Patch 32072819:R12.AP.B> and patch 32157516:R12.AP.B and 32181474:R12.AP.B and 32266274:R12.AP.B and 32433768:R12.AP.B
12.2.x <Patch 32072819:R12.AP.C> and patch 32157516:R12.AP.C and 32181474:R12.AP.C and 32266274:R12.AP.C and 32433768:R12.AP.C

 
 

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