1099 Automation with Nelco

PROCESSING 1099 FORMS IN ORION Nelco Integration - 2024

Processing and creating 1099 Forms is done once a year and can be a challenging and intimidating task.  Procedures performed on a daily, weekly or monthly basis are easy to remember.  Those performed only once per year require “refreshing” your memory every time you need to use the procedure.  The key to making the production of 1099 Forms easier and less stressful is in setting up Vendors correctly on the front end and in knowing how to get the most out of the 1099 processing program. 

SETTING UP THE SYSTEM FOR 1099 PROCESSING

When a Vendor is entered in Orion, you may set up the Vendor to receive a 1099 Form.  This setting is located on the “Accounting Information” Tab. 

Choose the 1099 Type and enter the Tax ID to which payments will be reported.  If you have entered additional addresses on the Vendor record, you may choose any one of those to use for the 1099 form instead of the Primary address.  The 1099 Type setting is used in Voucher Entry to determine how each line of distribution should be flagged - include or not include on 1099.  The setting on the Vendor is used as a “default” when entering vouchers using the Vendor Code and DOES NOT control whether or not a 1099 record is created during 1099 processing - that is determined by the flag on the voucher distribution line.   When you enter a new voucher, Orion looks at the 1099 Type and defaults each line of distribution to the Vendor setting. 

If the Vendor is set to a 1099 type other than “None”, the voucher distribution line will default as follows:

You may change this flag on each distribution line.  In other words, some payments (or portions of payments) to Vendors can be included on a 1099 Form and some can be excluded from 1099 reporting.  This also allows you to flag vouchers “on the fly” to be included in 1099 processing if the Vendor has not yet been set up for receipt of a 1099 Form.

If a voucher distribution line was not properly flagged prior to posting the voucher, you may change the flag by adjusting the voucher or by editing the line through the Vendor Status program.  Any voucher distribution line that contains activity affecting a Client-Matter should be edited through Vendor Status.

To edit the 1099 flag on the distribution line of a posted voucher without going through the Voucher Adjustment process, call up the Vendor in Vendor Status.  Once the Vendor information is displayed, access the Vouchers Tab and locate the appropriate voucher.  Right click on the voucher and choose the “Change 1099 Flag” option.  The following screen will appear:

All distribution lines for the voucher will be listed with the 1099 flag as the first field (check box) followed by the GL account number and description, the distribution line amount and a small portion of the voucher distribution description.  There is no grid-like maneuverability and the distribution lines are sorted by account number.  To set the 1099 flag on the distribution line to true, place a checkmark in the box on the left.  To set it to false, remove any checkmark.  Click OK to accept your changes.  Changes to the 1099 flag must be made prior to creating the 1099 Work File.

PREPARING FOR 1099 PROCESSING

Prior to processing your 1099 Forms for the year, we recommend you do a trial run to look for missing addresses and Tax ID numbers and to check that Vendors/Vouchers have been set up properly.

1.  Run the Total Vendor Payments Report (found under Accounts Payable Reports) for the year you are processing.

2.  Create the 1099 Work File for the same year and check for missing addresses and Tax ID numbers.

3.   Compare the amounts in the 1099 Work File to those shown on the Total Vendor Payments Report.

4.  Check to make sure any Vendor listed on the Total Vendor Payments Report that should receive a 1099 Form is also listed in the 1099 Work File.

5.  Records in the 1099 Work File can be edited.  However, to avoid confusion and extra work, you should attempt to have all changes/corrections to Vendors and Vouchers made prior to creating the “final” 1099 Work File.

PROCESSING 1099 FORMS

The processing of 1099 Forms in Orion is done through AP Manager by accessing the ACTION Button and choosing the “1099 Processing” option.  Once this option is chosen, the following Window will appear:

To customize your grid settings, make sure the toggle at the top is set to “Untyped”, right click and choose “Select Grid Fields” or click the SELECT COLUMNS Button.

TIP:       When the 1099 Work File is being created, the status or working bar is displayed at the bottom right of the AP Manager window or the main Orion Desktop window.  A status bar is NOT displayed in the 1099 Processing window.  For this reason, we recommend you not maximize the 1099 Processing window until after you have created the Work File.  You should be able to see the bottom of the AP Manager window or the bottom of the Orion Desktop.

The information you see when the 1099 Processing window is first displayed depends on what your default view is set to (if any are defined - see below) and whether or not you have created a 1099 Work File.  If you need to create your 1099 Work File, click on the CREATE WORK FILE Button.  The following Window will appear:

If you do not have to file 1099 Forms with your State, we recommend you leave the State Tax ID field blank.  However, if you want to include that on your Forms you will need to check the Firm Address in Orion Admin, System Settings and make sure the State field holds the appropriate abbreviation for the State.  This does not need to be done on creation of the work file but must be done prior to submitting the 1099 Forms to Nelco.  Once you have completed the requested information and clicked the OK Button, Orion will go out and look at checks written during the specified date range on all banks not specifically excluded from inclusion in 1099 processing.  Once it locates the checks it will look at the voucher distribution lines of the vouchers paid by these checks and see if they were flagged to appear on a 1099.  All such distribution lines are totaled for each Vendor and a record created in the 1099 Work File with the amount calculated placed in the YTDPayments column regardless of the 1099 Type.  A Vendor does not have to be flagged for a 1099 in order to be included in this Work File - they only need to have had vouchers paid where distribution lines were flagged to appear on 1099s.

As the program gathers the voucher distribution lines flagged to be included on a 1099, it looks at the Vendor record to see if the Vendor is set for a 1099 and places the 1099 Type in the Work File field called “1099 Type”.  If more than one Vendor has the same Tax ID (this includes more than one Vendor record with a blank Tax ID field), the program will return a message that a duplicate was found and let you know it is creating a record for the “second” vendor in the Work File and flagging the 1099 Type as None.  If you are running this for the first time, you may have to go through this process quite a lot if you do not gather Tax ID information up front from your Vendors. 

Below is a sample of the message that appears when duplicate Tax ID’s are found:

After the Work File has been created, data may be manipulated in the Work File by sorting on any column or filtering using the standard “columnar” filters. 

NOTE:   If you already have a default view defined that filters out Vendors paid less than $600.00, you will need to click the REFRESH Button after creating the Work File.

You may make any edits necessary in this Work File and they will not affect actual check data,  voucher data or vendor data.  Vendor related changes made in the 1099 Work File (i.e., address, Tax ID) will not change the actual Vendor record.  The changes will also need to be made through Vendor Setup for future 1099's. Likewise, editing the same information in Vendor Setup does not carry over to the 1099 Work File until a new Work File is created.  You may also add an entry to receive a 1099 Form - even if the recipient is not set up as a Vendor in the system.  Just click the NEW Button and add the entry.

Before editing any records, toggle from “Untyped Columns” to “Typed Columns”.  This will change your column headers and labels within the record entry view to reflect what box the amount will be shown in on the final 1099 Form.  To edit an individual record, double click on the record and it will open in the Record Entry view.  Make the necessary changes and click the SAVE Button.

To edit multiple records at once, select the appropriate records, right click and choose the “Edit Selected” option.  The following screen will appear:

Choose the field(s) you want to edit and click the NEXT Button.  A screen similar to the following will appear:

Enter the new values, click NEXT and then FINISH.

When the 1099 Work File is created, Orion places the total for each Vendor in the YTDPayments field.  The amount in this field will be placed in Box 1 of the 1099-NEC form, Box 10 of the 1099-MISC form (Gross Attorney Proceeds) and in Box 1 of the 1099-INT Form (Interest Income).  For a 1099-MISC form you may need to move the amount to a different field through the Record Entry view.

Once you have made all necessary edits to your forms you are ready to submit them to Nelco for printing and mailing to recipients as well as e-Filing.  Highlight the Forms you want to transmit and click the eFile Button (all forms must be of type 1099-MISC, 1099-NEC or 1099-INT).  Clicking the eFile Button will start the submission of your forms and bring you to the Nelco login page. If you have already created an account you may just log in.  If you have not yet created an account, click on the Create  Account option and complete the form that is presented.  Once you have logged in you will be presented with a screen similar to that shown below listing all forms you uploaded.

On this screen you will determine the service you want (the Bundle option is the recommended choice).  Click the NEXT Button and you are presented with a screen where you can enter email addresses for the recipients. 

Click NEXT after completing this (or skipping it) and the following screen will display. 

From here you can print a sample of the Forms that will be printed and mailed, a summary report and a detail report.  You can remove specific forms (or all) from submission but you cannot make edits to forms through the Nelco site.  Once you have reviewed this page, click NEXT and you will be asked for your credit card information.  Note that once you click PAY AND SUBMIT you cannot stop the printing or eFile process.

You can bail out of the process at any time prior to Paying and Submitting and remove the forms you have uploaded.  However, in the Orion 1099 Work File you will need to highlight your records, right click and choose “Clear Submitted”.  You can make any edits you need and then go through the submission process again.  You can re-create the 1099 Work File at any time for any year.  However, in order to do this, you should first delete the existing records in the Work File for that year.  This can be done by clicking the TOOLS Button, choosing “Delete Year” and specifying the year.

NOTE:   If the 1099 Work File is created for a year for which you have already created the Work File, existing records are NOT overwritten.  If you do not first delete the records for the year you are re-creating, you will have multiple records in the file for each recipient.

CREATING VIEWS

To better manipulate and filter your data, you should create at least one custom view.  Following are instructions that will create a View that limits the records displayed to those with a value in the YTDPayments field of $600.00 or more and a value greater than $0.00 in the Currency1, Currency2, Currency3 or Currency4 fields.

To create a View, choose TOOLS, Define View and then click the NEW Button.  The following will be displayed:

Enter a name for the Query and if you want to make this View available to others, check the “Make this Query Public” option.  To refine the Query, click on the QUERY DETAIL Button.  The following will appear:

Under the Query Criteria section, select (click on) “CalendarYear is Identical to 2019" and notice how the “Query Statement” at the top changes to give you the details of this Query.  On the actual Query Statement at the top, check the “Runtime” box.  This will cause the program to prompt the user for the Calendar year when they choose this View allowing the View to be used from year to year.

Now you need to add a line to the query that filters out records where the YTD Payments were less than $600.00.  To do this, click the ADD ITEM Button.  In the Query Statement section click on the drop down for the Field and Choose “YTDPayments”.  Choose “Greater Than” for the Operator and then enter 599.99 in the Value field.  Next, click the NEW GROUP Button and you will see a new “Group” line appear directly above the YTDPayments Greater Than... Line.  Highlight the new Group Line and change the operator to “Any”.  Your screen should now look as follows:

Click ADD ITEM to add a new query line under the new group.  Highlight the new item and in the Query Statement section click on the drop down for the Field and choose “Currency1".  Choose “Greater Than” for the Operator and then enter 0.00 in the Value field.  Perform this ADD ITEM function to add a line for Currency2, Currency3 and Currency4.  When you have added all items, your query screen should appear as follows:

If everything looks okay, click the OK Button.  Once back in the list of Views, highlight the View you just created and click the SET AS DEFAULT Button.  This will be the View (Filter) set every time you enter 1099 processing unless you change the Default View to another defined view.