This is the second consecutive year of an event that we all hope won’t become an annual one: the IRS announced changes yet again to the 1099-NEC form. There are minor changes to some boxes, and the 1099-NEC form is now three forms per page (where last year it was two).
- Form 1099-NEC sizing: there are now 3 forms per page.
- Form 1099-MISC, box 11. New use for box 11 includes any reporting under section 6050R, regarding cash payments for the purchase of fish for resale purposes, from an individual or corporation who is engaged in catching fish.
In addition to changes on the paper forms, there are electronic filing changes as described on pages 11-12 of this IRS Publication 1220.
Everyone needs to take action to ensure they are prepared to export the data in the proper fashion. Here’s what you need to know, broken down by product.
Dynamics GP: 1099-NEC Changes for Tax Year 2021
In case you were feeling nostalgic for 2020, Microsoft has you covered! Our Dynamics GP folks will run the same drill as last year.
Option One: Apply GP Year-End Update
If you are running GP 2018, the best option for you will be to apply the annual year-end update.
PLEASE NOTE: This means if you are NOT on GP 2018 (i.e. GP 2016 or earlier), you need to move to option 2 or 3 below.
This year-end update releases in November, and will automatically include the updates to the new 1099-MISC and 1099-NEC forms. GP 2018 users are all set.
Greenshades is a trusted ISV partner of ours. We’ve recommended them for years, but they are especially useful now. You can work with Greenshades to file electronically or have them send out the 1099s for you. They will ensure you’re compliant with the new standards, and can work with all versions from GP 2013R2 up. The only downside that our customers have reported is that this option is pricey.
Option Three: Use a Third-Party Solution
The final option is to buy an add-on product like one of these below to print the forms. Some have electronic filing instructions with an exported file from Dynamics GP to Excel/CSV.
These online or downloadable programs are recommended by GPUG users (but the Crestwood team has not vetted these, yet. We will update as we continue to test and learn more).
- Tax 1099
- eSmart Payroll
- 1099 Express
- Tax Forms Store (comes bundled with the Office Depot brand 1099 forms)
Dynamics SL: 1099-NEC Changes for Tax Year 2021
We have options if you are NOT on Dynamics SL 2018. Please reach out to your Crestwood Account Manager or send us an email at email@example.com and we can help direct you.
Acumatica: 1099-NEC Changes for Tax Year 2021
Acumatica will implement some changes in upcoming versions to ensure proper compliance when filing.
According to Acumatica, “these changes will most likely be available in the following builds of Acumatica:
- 2020 R2 U19 (mid-November)
- 2021 R1 U17
- 2021 R2 U3 (early-November)”
We don’t have a final word yet but we’re staying abreast with any announcements from Acumatica.
If you are on a version of Acumatica 2020 R1 or older, you must reach out to us to discuss your options to upgrade!
Business Central: 1099-NEC Changes for Tax Year 2021
Man, do Business Central folks have it easy!
Last year, it was as simple as clicking a button – just running the action Update Form Boxes on the 1099 Form-Boxes page.
While there is no official news from Microsoft yet, we suspect that the same will be true this year.
How spoiled are our Dynamics 365 Business Central clients?