Sage 100

Client emailed me that Pennsylvania is requiring her to withhold PA state w/h taxes from 1099 payments which meet certain criteria. Anyone dealing with this? Any suggestions on how to get Sage to calculate the taxes for 'just' these specific vendors? I'm thinking a UDF and some kind of script to reduce the amount due. Would also be nice if I could push to Aatrix, but not holding my breath there. Thanks!

We are using a workaround in another system using payment terms. If any of these vendors already have discount terms set up, then it won't work. Basically, create a Payment Terms Code that withholds 3.07% no matter how many days it takes to pay. Post that ""discount"" to a tax withholding account instead of a normal discount account. It still doesn't help with year-end reporting, but it at least gets the amount withheld from current payments and starts tracking the transactions.

Why not just create the GL account and in the lines use 2 lines. 1 for gross, 1 for the tax withheld. You will have to then modify the 1099 history to move the tax withheld into box 4 (tax), but Aatrix will pick it up then.

Info: http://www.revenue.pa.gov/GeneralTaxInformation/Tax%20Types%20and%20Information/EmployerWithholding/Documents/1099-MISC_Fact_Sheet.pdf

@NancyHanson It feels like Monday all over again and I was totally over thinking this one. Thanks!

This is what Sage has to say about it. Doesn't seem like a 'complete' workaround but the Aatrix info at the bottom seemed important to share.

Example - $1,000 in payments and $100 withheld. Though $900 is actually paid to the vendor, the 1099 needs to show payments of $1,000 and the $100 withholding.

I actually recommended she enter 2 invoices. One for the correct 1099 box and the full expense amount and the second for the tax withheld (entered as a credit amount) and directed to Box 16, for State Tax Withheld. A little more work on the front end, but less of a hassle at year end. Plus she can add PA Tax Withheld to the invoice comment and have it show on the check stub, so the vendor knows why the check amount doesn't match the invoice.

Did the second credit appear as a positive amount in the withholding box?

@JeffSchwenk I didn't think of that. She hasn't processed anything yet. Looks like i'm going to have to do some inhouse testing quick.

@JeffSchwenk Processed 2 invoices, one for the expense pointed to box 7 and one for the tax to box 16 and then paid them. 1099 Payment History under vendor maintenance shows the tax as a positive amount. However, AAtrix does not pull it into the grid. I'm going to email them about it. At least I could pull a report from the 1099 Vendor Payment History with the tax withheld amounts to make it easier to enter and the expense box will be correct already, so less data entry.

Did you cut a check? 1099 reflects check PAYMENTS. Will be interesting to hear what Aatrix comes back with.

Yep, paid them.

Good. While you are on the phone with Aatrix, ask them how the 941 employee count works. Maybe kill two birds with one stone......... https://90minds-com.socialcast.com/messages/39021485?ref=stream

I remember the Aatrix W2 filing asking if any 1099 employees had taxes withheld, so there was a place to put it there, but no mechanism to actually book it into withholding taxes during AP invoice date entry. Forgive me if that part was already obvious!

Just had an email from Aatrix. It doesn't like the negative amount, that's why the Box 16 isn't populating. Still, at least I can get the info from the 1099 Payment History and she only has to enter the tax amounts into Aatrix.

It looks like this requirement is a small subset of the payments being processed. I found this summary document. I looked it up for another business I have in PA. Thought others might find this helpful. http://www.revenue.pa.gov/GeneralTaxInformation/Tax%20Types%20and%20Information/EmployerWithholding/Documents/1099-MISC_Fact_Sheet.pdf