1099-NEC for AccountMate

Dear Clients,

The year 2020 certainly had its challenges, and while we’re all hoping 2021 will take that down a notch, we’ll have to start out with the challenge of updating systems to address the new IRS 1099 reporting requirements that split subcontractor payments out of the beloved 1099-MISC to a new 1099-NEC report.

Please consult with your CPA and refer to the IRS website for legal details. The overview is that the 1099-MISC has been reformatted and retains reporting for rents (box 1), royalties (box 2), prizes and other income payments (box 3), fishing boat proceeds (box 5), medical and health care payments (box 6), crop insurance proceeds (box 9), payments to an attorney (box 10), section 409A deferrals (box 12) and nonqualified deferred compensation (box14); while the brand new 1099-NEC must be used for “Non-Employee Compensation,” translation “subcontractors” (previously reported on the 1099-MISC in box 7). Importantly, IRS regulations specify the forms must be provided to the recipients by January 31, 2021 and penalties are steep!

Thus, time is short and accommodating this will require immediate program updates to your AccountMate system if you’re using the Accounts Payable module, which is all but two of NexLAN’s nearly 300 direct clients, so please read on… 

AccountMate presented a one hour webinar on the system changes and reporting via Aatrix on Wednesday, December 23rd, which you can review on their website.

➤ If you’re running AccountMate/SQL version 9/10/11 or AccountMate/LAN version 8/9/10 and have an active Lifecycle plan, then the 1099 update for 2020 modifications and instructions are provided as a benefit of that. Please note NexLAN installation services and possible integration effort to existing modifications are not included in the Lifecycle agreement and would be a billable event.

➤ If you’re running AccountMate/SQL version 9/10/11 or AccountMate/LAN version 8/9/10 and DO NOT have an active Lifecycle plan, then AccountMate corporate has a special offer to provide the enhancement so please contact NexLAN immediately!

➤ If you’re running AccountMate/SQL version 8 or prior, or AccountMate/LAN version 7 or prior, then… well… the options are limited… We can discuss customizing your system or upgrading to a recent version, neither of which will be easily done in the time frame available but we can try.  The alternative is manual reporting—a tedious and error-prone process since it will require exporting or transcribing data from your system. However, we’re still very interested in discussing getting your system current as I’m QUITE SURE we’ll be seeing additional tax law changes in the not far-flung future which could be even more labor intensive if your system doesn’t accommodate them…

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In other news…

➤ Our annual beginning-of-year suggestions:

1. Lock your January 2020 fiscal period! In the General Ledger module, hit <Housekeeping><Posting Period Restrictions> to lock at least your January 2020 fiscal period so nobody typos the year and restates financials from a year ago…
2. Make a backup of your live company! You WILL later want reports that are difficult to create after transactions have occurred. Our NexSQLBack utility makes this quick and easy.
3. Check your database maintenance plan directory! Please ensure the automated nightly backups of your database are being created—then confirm with your IT department these are being copied offsite. You think your 2020 was bad? The record “months of data loss” this year for a client not having database backups offsite (where the ransomware wouldn’t have reached them) is six. Yup, loss of six months of data they’re still working on recreating…
4. Photocopy your wallet! We are talking backups here, right? It’s pretty valuable to have a backup of your personal portable accounting information for “just in case.”

➤ Summary of links to the period and year-end closing articles and videos provided in last month’s newsline:

1. Article # 1257: Period-End Closing Procedures

2. Article # 1258: Common Closing Errors

3. Article # 1261: Year-End Closing Procedures

4. Article # 1262: Year-End Closing Tech Tips

5. Video: Closing the Period in AccountMate presents the recommended procedures for closing the period in subsidiary modules. It also identifies some common issues that may be encountered during closing and provides tips on how to resolve them.

6. Video: Year-End Closing in AccountMate focuses on the requirements and procedures for closing the fiscal year in the General Ledger module. It also provides tips to help effectively perform year-end closing.

➤ The vast majority of our support is provided remotely, so most of our clients have never met us. To put faces with the names, you can now see all of us and our baseball nom de guerres at Meet the Team on our website.

➤ New for 2021, we’re broadening our product offerings to include Acumatica—another mid-tier accounting and financial management software suite with a very different approach. Acumatica is browser-based, most often hosted at Amazon Web Services with subscription-based pricing.

All our best to everyone in the new year—Nihonjin no tomodachi ni akemashite omedetô—and we look forward to supporting you in 2021!

Regards,

Kevin E. Stroud
NexLAN, LLC
https://nexlan.com 

February 8-22, 2021 Online Core Product Training for AccountMate/SQL

The AccountMate Core Product Training class is held quarterly and covers the core modules of System Manager, General Ledger, Purchase Orders, Accounts Payable, Inventory Control, Sales Orders, Accounts Receivable and Bank Reconciliation. Hands-on exercises are provided to facilitate the learning process and give attendees a chance to have one-on-one interaction with the instructor.

Totaling 38 hours over 11 days, this is a deep dive into the modules most all clients use and is valuable for both novice and experienced users. It’s priced at $2,500/attendee or $300/session—but don’t forget your annual free and discounted seats with your Lifecycle subscription.

Registration is now open for the February class, and these have been known to fill up so please contact us SOON if you’re interested. The following session is penciled in for June 7-21, 2021 with registration opening in February.

Click here for Course Overview, Course Outline, and Course Schedule—then reach out to us if you don’t see your favorite module listed, or if you’d like training personalized to your business processes and modifications. We’re always standing by in the cornfields!

AccountMate/SQL V12.1 on the Horizon

We’re already hearing rumblings of the next release of AccountMate/SQL, to be dubbed V12.1 as there’s major feature enhancements included.

The “New Features Webinar” is scheduled for Monday, February 1st, noon to 1:30pm CST and sign up is here.

Of course, features are never guaranteed until the product ships, but they’re certainly telegraphing SOMETHING with the title of “TaxJar Features & Benefits with AccountMate Integration in AM 12.1,” scheduled for Thursday, February 4th, noon to 1pm CST. Sign up is here.

Supported Tax Forms for AccountMate

As much we’d love the world to be completely paperless, if you’re not filing your 2020 tax forms electronically then you’ll need special paper—but what special paper?

Below is the detailed list by module and form. To simplify the process, the forms are available for purchase in multi-quantity packs at https://accountmateforms.com/ so we’ve also listed the product item numbers.

Payroll Tax Forms

W-2

  • Federal copy on 2 up on perforated blank paper—Items # 5207, 5222
  • State, employee and employer copies on 4 up on perforated blank paper—Items # 5209, 5221 (Note: The Employee copy can have the instructions printed at the back, but it is not required.)

Please note: If you use the Aatrix efiling option for your Payroll Tax Forms, then employees may directly import the W-2 data into their Intuit TurboTax, H&R Block or TaxAct personal tax filing software.

W-3

  • On plain paper only for Federal filing

1099-MISC

  • Federal copy on RED 2-up perforated pre-printed form—Item # 5110
  • State, recipient and payer copies on 4-up perforated blank paper—Item # 5221 (Note: The Recipient copy can have the instructions printed at the back, but it is not required.)

1099-NEC (new)

  • Federal copy on RED 2-up pre-printed form for federal filing—Item # NEC511
  • State, recipient and payer copies on 4-up perforated blank paper—Item # NEC610 (Note: The Recipient copy can have the instructions printed at the back, but it is not required.)

1096

  • Federal transmission on RED pre-printed form—Item # 5100

ACA Forms

  • Federal 1095 and 1094—both use plain paper (Note: For the Employee copy, you can either buy paper with pre-printed instructions on the back or use a plain paper and print the instructions on another sheet of paper.)

Accounts Payable Tax Forms

1099-MISC

  • Federal copy on RED 2-up perforated pre-printed form—Item # 5110
  • State, recipient and payer copies on 4-up perforated blank paper—Item # 5221 (Note: The Recipient copy can have the instructions printed at the back, but it is not required.)

1099-NEC (new)

  • Federal copy on RED 2-up pre-printed form for federal filing—Item # NEC511
  • State, recipient and payer copies on 4-up perforated blank paper—Item # NEC610 (Note: The Recipient copy can have the instructions printed at the back, but it is not required.)

1096

  • Federal transmission on RED pre-printed form—Item # 5100

Please note: Accounts Payable Tax Forms must be printed via the integrated Aatrix utility.

Technical Tips

Versions: AM11 for SQL and Express
AM10 for SQL, Express
AM9 for SQL, Express

Module: GL

Q: I created a Batch Transfer Data to GL schedule. How can I verify whether the scheduled transfer ran successfully?

A: Access the Batch Transfer Data to GL function and review the information in the Last Transfer Date and Last Batch Transfer Status columns. The Last Transfer Date should coincide with your schedule and the Last Batch Transfer Status should show “Completed” if the data transfer from each module was successful. If the transfer was not successful, then the Last Batch Transfer Status will show “Failed”.

You may also want to generate the GL Transfer Report from the subsidiary module. Look for the latest transaction in the GL Transfer Report and verify that the transaction is in the General Ledger Listing report.

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Versions: AM11 for SQL and Express
AM10 for SQL, Express and LAN
AM9 for SQL, Express and LAN
AM8 for LAN

Modules: AP, BR, PR

Q: I want to void a check that has been cancelled; but, the bank reconciliation is yet to be finalized. How can I void the check?

A: You must unreconcile or uncancel the check before you can void it. To do this, perform the following:

1. Access the Reconcile Bank Account function in the Bank Reconciliation module; then, perform these steps:

a. Enter the bank number.
b. Go to the Details tab; then, click the List box button in the first field and select
the Unmark Reconciled option to display in the grid the checks and deposits
that were previously marked cancelled or verified.
c. Unmark the checkbox for the previously reconciled/cancelled check that you
want to unreconcile or uncancel.
d. Save your changes.

2. Go to the Accounts Payable or Payroll module. Void the check using the Void
Check (to void Accounts Payable checks), Void Payroll Check (to void Payroll
checks), or Void Tax Deposit Check function (to void Payroll tax deposit checks),
whichever is applicable.

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Versions: AM11 for SQL and Express
AM10 for SQL, Express, and LAN
AM9 for SQL, Express, and LAN
AM8 for LAN

Module: PR

Q: We are accruing paid leave hours; however, we do not want the accrual to affect General Ledger. We want to expense paid leave hours as they are used. How can we set this up in AccountMate?

A: AccountMate always creates journal entries when paid leaves are accrued and/or used. When you transfer payroll data to GL, these journal entries will be transferred to the General Ledger (GL) module as follows:

Accrual of Paid Leave

DR: Expense GL Account ID*
CR: Liability GL Account ID**

Usage of Paid Leave

DR: Liability GL Account ID**
CR: Expense GL Account ID*
DR: Expense GL Account ID*
CR: Wages GL Account ID***

* From the Paid Leave Code Maintenance ► Expense Account field
** From the Paid Leave Code Maintenance ► Liability Account field
*** From the PR Module Setup ► GL Accounts tab ► Liability Account area ► Wages field

If you do not want the paid leave accrual to affect the GL Account ID balances, it is suggested that you enter the same paid leave Expense GL Account ID in the Paid Leave Code Maintenance ► Liability Account and Expense Account fields. AccountMate will then use the same GL Account ID in both the debit and credit entries generated when you record the paid leave hours accrual and usage. Though journal entries are created and later transferred to the General Ledger, these entries have zero net effect on the GL Account ID balances. Of course, please verify this suggested setup with your CPA prior to implementation.

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