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Form 1099

Setting Up Payers

The Payers page is used to set up payers, enter state payer numbers and set up additional payer information for accounts that report the payer. To access the Payers page, select
SETUP
 then
Information Reporting Setup
.
When setting up payers, you can enter or update the payer EIN, name and address for the following types of payers:
  • Bank Default
  • DIOB/MISC/NEC by SUBID
  • 1099R Default
  • 5498 Default
  • 1099Q Default
  • 1099R by SUBID
  • 5498 by SUBID
  • 1099Q by SUBID
Setting up additional payer information for accounts that report the payer includes setting up:
  • 1099Misc-SP, 1099-NEC and 1098 payer overrides
  • 1099-R payer overrides
  • 1099 options, and 5498 and 5498-ESA options

Setting Up Payers

On the Payers page, all payers are included in the grid under the
1099 Payer Information
 collapsible section. The payers are listed in the grid ascending order according to payer ID.
A Bank Default payer must always exist. The Bank Default payer information is used on all of your information returns only if no other payer type is set up. The Bank Default payer information is initially based on the fiduciary information entered in the Fiduciary Info options on the Options and Overrides page. You can leave the information as is or change it.
note
The first time you use ONESOURCE Trust Tax to process information returns, you will need to activate the Bank Default payer. To activate the Bank Default payer, access the Payers page then select
Save
.
Although you can process your information returns with only one Bank Default payer, you should set up at least one 1099R Default, 1099Q Default and 5498 Default payer to use as the primary payers for Forms 1099-R, 1099-Q and 5498. Additional payers for these information return types (referred to as payers by Sub ID) can be added based upon account Sub IDs. Payers by Sub ID allow you to have multiple payers within the same PAN. The Sub ID codes identify the accounts that will include the specific payer information.
When you add additional payers, the payer ID and SUBID can exist only once per payer type. For example, if a Bank Default payer is set up with a payer ID of 99-7777888, there cannot be another payer with the same payer ID and a type of DIOB/MISC/NEC by SUBID.
You can set up as many payers by SUBID as you need.
To set up a payer:
  1. Select
    SETUP
     then
    Information Reporting Setup
    .
  2. Under the
    1099 Payer Information
     collapsible section, select the type of payer you want to set up from the
    Type
     drop-down list in the row that includes the text, "Please select here to add new payer."
  3. Enter the payer EIN in the
    Payer ID
     field, and the payer name and address in the respective fields. Be sure to enter the payer EIN and payer name of the legal entity. For sole proprietors, the payer name is the individual sole proprietor's name, not the business name. A payer EIN can be used with one name only. Each legal entity must have a unique name. You cannot use identical names for numerous entities. If there is a name change for an entity, write a letter to the Entity Control Section at the IRS Service Center where tax returns are filed or call 1-800-829-4933 and ask to speak with the Entity Section to update the Business Master File Entity Record. If you do not request the update, the old business name is retained on the IRS records even though you may have filed certain returns with the new name.
  4. Press ENTER to add the payer to the grid.
  5. Select
    Save
    .
  6. If you are setting up a sub ID payer, enter the payer's sub ID in first field in the
    Sub-ID
     group box located below the payer grid. Select the
    Add
     link to add the sub ID to the payer's sub ID list.
  7. You can enter a maximum of three digits for a sub ID. You can add more than one sub ID for a payer, but a sub ID can exist only once per payer type. For example, you cannot specify the same sub ID for two 1099R by SUBID payers. However, you can enter the same sub ID for a 1099R by SUBID payer and a 5498 by SUBID payer.
  8. Select
    Save
    .
  9. If you want to add the payer's state numbers and set tax deferred form options, select the payer's
    Detail
     link in the grid under the
    1099 Payer Information
     collapsible section. If you change the payer detail, select
    Save
     before navigating away from the detail page.

Entering State Payer Numbers

The IRS does not require the state payer number (sometimes referred to as the state payer identification number) to be included in a CFS file, but some states do. In ONESOURCE Trust Tax, you can enter state payer numbers using the
Payer's State Numbers
 page.
note
A state can have a direct filing requirement even if the state participates in the IRS CFS program.
To enter a state payer number:
  1. Under the
    1099 Payer Information
     collapsible section on the Payers page, select the
    Detail
     link for the payer you want to enter a state payer number for.
  2. Enter the state payer number for the applicable state in the
    Payer Number
     field. For Iowa, you can enter a nine or 12-digit state payer number. When saving, an error message displays if the Iowa state payer number is not nine or 12 digits.
  3. Select
    Save
    .

Setting Up Additional Payer Information for Accounts that Report the Payer

note
Review the payer information each year to prevent IRS unpostables and potential penalties for late filing.
For accounts that report the payer and that generate Form 1099 Misc-SP (disbursement of miscellaneous income), Form 1099-NEC or Form 1098, use the
1099 Misc-SP/NEC and 1098 Payer Overrides
 collapsible section on the Payers page to set up 1099Misc-SP, 1099-NEC or 1098 payer information.
For accounts that report the payer and that generate Form 1099-R, use the
1099R Payer Overrides
 and
1099R Options
 collapsible sections on the payer detail page to set up 1099R Default or 1099R by SUBID payer information. For 1099R Default and 1099R by SUBID payers, the
1099R Payer Overrides
 collapsible section is accessed by selecting the payer's
Detail
 link in the grid under the
1099 Payer Information
 section on the Payers page. On the payer detail page, the
1099R Payer Overrides
 collapsible section is located under the
Payer's State Numbers
 collapsible section.
On the payer detail page, the
1099R Options
 collapsible section is under the
1099R Payer Overrides
 collapsible section. The
1099R Options
 collapsible section allows you to set the following:
  • Accounts with the minor account type you enter in the
    Code / Type
     field can have the IRA/SEP/SIMPLE box on Form 1099-R automatically marked, be identified as a SIMPLE IRA account, or have distributions with a distribution code of 2 or 7 identified as Roth conversions.
  • Disbursements coded with the tax code you enter in the
    Code / Type
     field can have the total distribution amount reported on Form 1099-R.
Each 1099R option type can have multiple minor account types or codes. Each type or code must be added to the grid separately. For example, you cannot enter
064, 1234
 in the
Code / Type
 field for the
Check the 'IRA/SEP/SIMPLE' box based on these minor account types
 type. You must add the
064
 minor account type then add the
1234
 minor account type.
For accounts that report the payer and that generate Form 5498 or 5498-ESA, use the
5498/5498ESA Options
 collapsible section on the payer detail page to set up 5498 Default or 5498 by SUBID payer information. This section is under the
Payer's State Numbers
 collapsible section on the payer detail page.
The
5498/5498ESA Options
 collapsible section is similar to the
1099R Options
 collapsible section for 1099-R payers. Entering a minor account type in the
Code / Type
 field automatically marks the SEP, SIMPLE or Roth IRA box on Form 5498, or generates Form 5498-ESA.
Each 5498/5498-ESA option type can have multiple minor account types or codes. Each type or code must be added to the grid separately. For example, you cannot enter
9999
,
9998
 in the
Code / Type
 field for the
Check the 5498 'SEP' box based on these minor account types
 option type. You must add the
9999
 minor account type then add the
9998
 minor account type.

This article applies to:

  • PRODUCT: ONESOURCE Trust Tax