EAP: 1099 Correct File Uses Piggyback State Codes Even If Report Control Says Do Not Use
Last updated on JUNE 13, 2018
Applies to:PeopleSoft Enterprise FIN Payables - Version 9.2 and later
Information in this document applies to any platform.
We processed a correction file for some 1099 vendors and it was rejected due to 3 'B' records containing a Combined Federal/State Code but the 'A' record did not have a 1 in position 6. In looking through the code for the B record it never checks if the withholding Report Control has the "Combined Federal State Filing" flag selected. It only looks at the piggyback state table to see if it's listed. In this case we have it as unselected. Is the field "Combined Federal State Filing" meant to say do not use piggyback state functionality when the text file is produced?
The page I am referring to is under Setup Financials/Supply Chain, Product Related, Procurement Options, Withholding, Report Control Information. Under the Payer Information we have the "Combined Federal State Filing" flag as NOT checked.
1. Report Control Information setup- combined Federal State Filing is not checked
Piggyback States- All Checked
2. Create an adjust withholding
3. Run the 1099 job
4. Original IRS File
The original IRS file shows the address as 123 Main Street First Floor Room 001
All OK so far.
No States codes are populated- which is correct
5.Run the 1099 sent process
6.Now do a correction –
The correction was Adding a new address for the supplier and inactivate the old one used
So Address ID 1 is inactive
Address ID 2 is active (this is the one which was added)- this was the correction which was made.
On the 1099 withholding link – change the Address Seq to 2
Changed the address seq on the Payable Options page
Changed the address seq on the Procurement Options page
7. Run the 1099 job
Check the correction - IRS file generated
The new supplier address shows in the file
The state code is showing in the correction IRS file
Because of this IRS is rejecting the file because of the following reason.
3 'B' record contains a Combined Federal/State Code (or something other than spaces) in positions 747-748; however, the 'A' record does not have a '1' in position 6.
Refer to Publication 1220 or contact your software company or service provider for further information.
Record sequence number 3 is the first known record containing this error.
When customer manually deleted this code, IRS accepted the file.
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