Technology Services Sage Intacct Tips & Tricks: Recording Vendor Tax Identification Numbers
 
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You are probably letting out a sigh of relief now that you have issued your annual 1099s. You don’t need to worry about this again until next year, right? That would be nice! However, now more than ever, it is important that you utilize best practices to collect taxpayer identification numbers (TINs) of your payees (vendors) to get ahead of the year-end rush and reduce the risk of IRS penalties.

Now is the best time to identify payees (vendors) for whom you don’t have a TIN so you can solicit this information via Form W-9 before the year-end rush.

According to IRS Publication 1586, “Payers are required to solicit the TINs of payees in order to meet reasonable cause criteria as acting in a responsible manner to avoid information reporting penalties. Generally, a solicitation is a request made by a payer to a payee to furnish a correct TIN. An initial solicitation for a payee’s correct TIN must be made at the time a relationship is initiated.”

Solicitations are typically done via Form W-9, Request for Taxpayer Identification Number and Certification (see IRS Publication 1281). “Where a payee’s TIN is missing or incorrect after the initial solicitation, the payer may need to conduct annual solicitations for a correct TIN. A payer who received backup withholding notices reporting missing/incorrect payee TINs must make solicitations (via B notices to payees) pursuant to the backup withholding rules.”

Now is the best time to identify payees (vendors) for whom you don’t have a TIN so you can solicit this information via Form W-9 before the year-end rush. Once you have received a vendor’s W-9, ensure this information is correctly captured within Sage Intacct and attach backup documentation.

You can manage this information and keep your vendor and transaction records up to date in Sage Intacct with the following steps:

Identify Vendors with a Missing TIN

You can create a custom list view that shows which vendors have, and which vendors don't have a Tax ID on their vendor record.

  1. Navigate to the Accounts Payable > Vendors list page.
  2. Locate the Manage Views drop-down menu at the top of the Vendors page, and choose Create New View.
  3. On Step 1 of the Create New View wizard, select the columns of data you want to include such as:
    • Vendor ID
    • Tax ID
    • Form 1099 Type
    • Vendor Name
    • Attachments
    • 1099 Name
    • 1099 Contact (be sure to scroll to the Contactto1099 section).
  4. Navigate through the remaining steps in the wizard using the arrows in the top, right corner of the Create New View screen to make other changes as desired. For example, you can:
    • Choose the order in which columns appear.
    • Choose the sort order for columns, such as by Vendor ID or Tax ID.
  5. Ensure you have named your new view.
  6. Click Save.
  7. On the Vendors list screen, navigate to your new view by selecting the drop-down list located to the left of Manage Views.
  8. Use the Advanced Filters link above the list to detect missing field values in the list. For example, by setting the filters below, you will find vendors who have a 1099 Box value but who do not have a Tax ID.
    • Tax ID – field equals null.
    • Form 1099 Box – field not equals null.

Add 1099 Information for a New Vendor

Adding 1099 information to a new vendor record is a little different from adding 1099 information to an existing vendor.

  1. Navigate to Accounts Payable and click the + sign beside Vendors.
  2. In the vendor page, click the Additional Information tab.
  3. In the Tax ID field, enter the payee’s TIN as it is reported on Form W-9.
  4. Select the 1099 Eligible option and, in the 1099 Name field, enter the vendor name as it should appear on 1099 forms.
    • After you flag the vendor as 1099 eligible, this checkbox disappears and becomes a link to access the vendor's 1099 forms.
    • To remove the vendor's 1099 status, see Change 1099 Status for a Vendor below.
  5. Click Save. The Form 1099 Information with Default Box page appears.
  6. Select the 1099 form that the vendor receives, and the default 1099 box where payments to the vendor should be tracked (this can be overridden on a per-bill basis). Click Save to the save the Form 1099 information entered.
  7. Attach an electronic copy of the W-9 to the vendor record.
  8. Click Save on the Vendor Information page.

Add or Edit 1099 Information for an Existing Vendor

  1. Navigate to the Accounts Payable > Vendors list page.
  2. Click Edit beside the relevant vendor.
  3. In the vendor page, click the Additional Information tab. 
  4. In the Tax ID field, enter the payee’s TIN as it is reported on Form W-9.
  5. In the 1099 Name field, enter the vendor name as it should appear on 1099 forms.
  6. Click the Form 1099 link.
  7. On the Form 1099 Information screen, select the 1099 form that the vendor receives and the default 1099 box where payments to the vendor should be tracked. Click Save to save the Form 1099 information entered.
    • After you click Save, a pop-up will appear that asks if you'd like to update the associated bills and adjustments for this vendor and tag them as 1099. Click Yes to automatically update these transactions, or click No to leave them as they are (not tagged as 1099).
  8. Attach an electronic copy of the W-9 to the vendor record.
  9. Click Save on the Vendor Information page.

Change the 1099 Status for a Vendor

What do you do if you've configured a vendor as a 1099 vendor, created 1099 transactions against that vendor, and then discovered that the vendor shouldn't be treated as a 1099 vendor?

Good news! With just a single change to the vendor information, you can remove or add the 1099 status for the vendor and automatically update the associated vendor transactions. Such changes to transactions apply to both the current and prior year transactions.

Run a Report to View Affected Bills

Before you actually add or remove the 1099 status for a vendor and update the associated transactions, it's a good idea to run a 1099 report to get an idea of just how many transactions will be affected. After you add or remove the 1099 status, you can then run the report again to verify that the change took place.

  1. Navigate to Accounts Payable > Reports > 1099/1096, and click 1099 Reports.
  2. Select the Reporting Period of Current Year.
  3. Select or enter the vendor in From Vendor.
  4. Select the relevant 1099 Form Type(s).
  5. Select Detail in Summary/Detail.
  6. Click View. The report appears with a list of transactions for the selected vendor.
    • Notice that the report displays the Tax ID and the 1099 Category for the vendor transactions.

Remove the 1099 Status from a Vendor

It’s simple to remove the 1099 status on the Vendor Information page. After you remove the 1099 status from a vendor, you can automatically update associated bill line items. Or, you can use the 1099 vendor transaction template to import updates to the transactions.

  1. Navigate to Accounts Payable > Vendors.
  2. Click Edit beside the relevant vendor.
  3. In the vendor page, click the Additional Information tab.
  4. Click the Form 1099 link. The Form 1099 Information with Default Box page appears.
  5. Clear the amounts from the form boxes.
  6. Set Form Name to None.
    • If you don't clear the Form Name field, and then save, the form won't be cleared and will reappear the next time you click the Form 1099 link.
  7. Click Save on the Form 1099 Information with Default Box.
  8. Optionally, clear the vendor’s 1099 Name and Tax ID.
  9. Click Save on the Vendor Information page.
    • After you click Save, a pop-up will appear that asks if you'd like to remove the 1099 tags on the associated bills and adjustments for this vendor. Click Yes to automatically update these transactions, or click No to leave them as they are (tagged as 1099).

If you have questions about recording taxpayer identification numbers in Sage Intacct, or if there are other Sage Intacct topics you’d like to hear more about, click here to start a conversation with our team.

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