Features in Microsoft Dynamics AX That Support Form 1099-MISC Reporting

Prepared by: Greg Griffith of Interdyn BMI

Overview

In the USA, it is tax season every spring from January through April 15.  For enterprises, this includes an obligation to send out IRS forms like Form 1099-MISC’s on a timely basis.

Form 1099 is a document of the US Internal Revenue Service (IRS) that many companies must use to report on payments to small vendors and individuals. For many companies, like manufacturers or distributiors, most reporting will involve Form 1099-MISC reporting for Box 7 – Non-Employee Compensation. This blog article describes features in Microsoft Dynamics AX that support Form 1099-MISC reporting.

Disclaimer: This information is likely to be helpful but please consult your own sources for complete tax accounting and software information.  Please use this information at your own risk.  Thank you.

Vendor Setup

  1. Go to the All Vendors list at one of the following locations:
    1. Accounts payable > Common > Vendors > All Vendors
    2. Procurement and sourcing > Common > Vendors > All Vendors
  2. Select a Vendor or enter a new Vendor.  If needed, enter Edit mode.
  3. Go to FastTab for Tax 1099.
    1. See screenshot for illustration and additional steps below:
    2. If the Vendor needs Report 1099 reporting, then do the following steps:
      1. Select the checkbox for Report 1099.
      2. Enter value for Federal tax ID:
      3. Enter value for Tax ID type.
      4.  Enter value for: Name to use on the 1099. Options are Vendor name; Doing business as.
      5. If applicable, enter value for DBA:
  4. Within the Vendors form on the Vendor tab, go to button for Setup > Vendor state tax IDs. Form will open.
    1. Complete data as needed.
    2. Close the form.

Recording Form 1099 Reportable Transactions

Once a Vendor has been setup for Form 1099 Transactions, then transactions will begin to accumulate automatically:

  • AP Invoice Journal (Non-PO Invoices)
  • AP Vendor Invoices (PO Invoices)

Invoice Journal

On an Invoice Journal, transactions for a Vendor who has been set up for Report 1099 will be automatically posted as 1099 transaction. See screenshot.  The invoice journal has a tab for 1099 activity but no entries are required unless you want to change values such as over-riding the amount to something less than the full amount.  The 1099 tab can also be a place to enter a State code (if needed).

Even if you do not enter a value in the 1099 amount field, any payment that is posted for the invoice amount contributes to the 1099 total for the specified 1099 box. If you do enter a 1099 amount, the amount that you entered is used instead of the posted payment amount.  You can clear the 1099 box field for any invoice line that needs no 1099 tracking.

Vendor Invoice

Similar to an Invoice Journal, the Vendor Invoice will automatically post transactions as 1099 transactions for a Vendor who has been set up for Report 1099. See screenshot below.  The Line Details area of the Vendor Invoice form has a tab for 1099 activity but no entries are required unless you want to change values such as over-riding the amount to something less than the full amount.  The 1099 tab can also be a place to default in a Delivery State code (if needed).  Even though a 1099 amount does not show, it will be recorded.  A Delivery state amount will not be recorded unless a value is provided for Delivery state.  See screenshot below.

Even if you do not enter a value in the 1099 amount field, any payment that is posted for the invoice amount contributes to the 1099 total for the specified 1099 box. If you do enter a 1099 amount, the amount that you entered is used instead of the posted payment amount. You can clear the 1099 box field for any invoice line that needs no 1099 tracking.

Updating Vendor Transactions Mid-Year

If a Vendor is set up at mid-year for Report 1099, then transactions from earlier in the year can be added to the 1099 transactions using the Update process.  Steps are described below:

  1. Go to: Accounts payable > Common > Vendors > All vendors.
  2. Select Vendor.
  3. On Vendor tab, select action button for Update 1099. Form will open.
  4. Enter parameters on the form and press the OK button.

Note: This form provides a way to update the State/province code on existing 1099 transactions, if needed.

  1. When ready, press the OK button.

See screenshot for details:

Adjusting Form 1099 Transactions

  1. Go to: Accounts payable > Periodic > Vendor settlement for 1099’s.  Form will open.
  2. Select text button for Tax 1099 transactions. Form will open.
  3. Set and remove parameters and filters as needed.
  4. Edit fields as available and needed.   Many values can be changed.  See screenshot:

1099 Transactions – Beginning Balances

When going live on AX 2012 during mid-year, you may want to bring in a Form 1099 transaction balance from a legacy system.  In order to do this, one way is to enter a “dummy invoice” equal to the total of 1099 transactions from the legacy system.  Enter an offset account and remove the Method of Payment it so that it does not get selected to be paid.

You may want to use a clearing account such as an AP clearing account.  If so, use an AP invoice journal with offset to Account 2002.  Use an AP Payment journal with Method of Payment left blank and an offset to the AP Clearing Account.

1099 Reporting

For 1099 Reporting options, see the following menu paths:

  • Accounts payable > Reports > Tax 1099 > Tax 1099 summary
  • Accounts payable > Reports > Tax 1099 > Tax 1099 detail
  • Accounts payable > Periodic > Vendor settlement for 1099s

Note: Microsoft has published software “hotfixes” at the end of calendar years to help support Form 1099.  Look for Microsoft hotfixes in the usual places.

Why You Should Attend the 2015 AX User Group Summit

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The AX User Group Summit in Reno, NV is three days dedicated to helping you increase productivity and get maximum benefits from your Dynamics AX implementation. Attendees will have a unique opportunity to network with and learn best practices from other users, to discover the solutions to issues from other professionals who use the software every day, and to participate in interactive training sessions and group discussions.

Developing and maintaining professional relationships is an important aspect of any organization, especially in today’s technology-driven world. The User Group Summit is the perfect place to network and build a stronger community with your clients, partners, Microsoft representatives and other passionate individuals in the industry.

In addition to 200 interactive breakout sessions with other users and subject-matter experts, the conference will enable you to learn more about the software from Microsoft employees and technology partners. You can also attend the Expo, which features some of the top Dynamics Partners. You’ll learn new ideas and evaluate add-on solutions that could help your organization realize additional productivity from your implementation.

George Kourounis is the keynote speaker this year and he is ready to motivate you into “making the fear disappear”. As a storm-chaser and the host of Angry Planet, Kourounis will show you that fear is not only something that can be managed & controlled, it is a vital element to accomplishing anything worthwhile. Plus, the Summit expo floor will be filled with Microsoft product experts, giving you the chance to ask all the questions you have about your business solutions. Get ready to leave inspired.

InterDyn BMI is a Gold Sponsor and will be at Booth #725Register now to join us!

Step-by-Step instructions for creating case categories in Microsoft Dynamics AX

Step-by-Step instructions for creating case categories in Microsoft Dynamics AX By Donald Hilton, AX Product Manager

Creating case categories in Microsoft Dynamics AX really saves time.

1. Click on FCMP>Sales and marketing>Setup>Cases

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2. Click the New button arrow and Select Case Category

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3. In the top section enter a case category. This field has a 10 character limit but you may include additional details in the description.

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4. Select the Category type, you cannot change these. This is the 1st level in the hierarchy.

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5. Use the Ctrl + S keys to Save the Category. Above is the information window that
will come up when you save the category. Those fields are all that are required to create a Case Category.

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6. In the next section you can add additional functionality.

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7. Workers are a drop down of all employees and are the person this case will go to 1st. If left blank you would select this person at the time the case is entered.

8. Department is a financial dimension that would allocate any associated cost to that department.

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9. Activities- These are also optional fields to be filled in.
Task: predefined listing that will create entry’s in the CRM.

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Type: user defined listing of what for further reporting.

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– Phase: user defined listing for organization of Case work

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 Purpose: is just a free text note field.

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10. All of these fields are option and can be set when you create the case.  The purpose to set them here is so they will default when a case is created.

Click here to learn more about Microsoft Dynamics AX, contact us or visit our website at http://www.interdynbmi.com/.

How to use the Task Recorder feature in Microsoft Dynamics AX 2012

The Microsoft Dynamics AX 2012 task recorder is a tool that will aide in the documentation process. This documentation can provide the step by step instruction for completion of the process as required. Once generated and verified, can be accessed online by users or provided as a hardcopy for work instructions. The task recorder is also a great tool to record a process issue or record the steps needed to duplicate an error or software bug.

To use the Task recorder go to File > Tools > Task Recorder

The Task recorder button will appear:

To record, click the RED button

From this point forward, any click / selection within the application will be recorded. This includes screen shots and movement through modules.

When completed with the process > Click the BLUE button:

A prompt will appear asking if you wish to ‘Save this task?

If you are done recording, click on Yes and then enter additional task notes as desired.

Once the task is saved, the Task recorder buttons will re-appear. To generate the Microsoft Word document of the recording, click the ARROW button.

The recorded tasks form will open.

The Generate document prompt will appear. Normally, the task recordings are generated in Microsoft Word (default).

The following is an example of a Microsoft Word document created (Click to enlarge).

If you have any questions or would like to learn more about Microsoft Dynamics AX, please contact one of our representatives through our contact form.

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