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Preparing for Year-End Filing: Making W-2 & 1099 Reporting Organized and
Easy
Connie Davis, Greatland
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Meet Our Speaker
Connie Davis Product Compliance Architect at
Greatland
• Over 34 years of payroll and payroll tax
compliance
• Served on the By-Laws Revision
Committee and the Nominating and
Elections Committee of the APA.
• Served for 3 years on the IRS’
Information Reporting and Advisory
Committee (IRPAC) as well as on the
advisory board of Commerce Clearing
House’s Payroll Management Guide.
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• Common year-end reporting
problems and mistakes
• Tips and tricks for organizing
paperwork
• Ways to make reporting easier
• Forms you can file electronically
• Solutions available to small
businesses
Objectives
After this webinar, you should
be able to identify:
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• W-2 and W-3 – for reporting employee
income
• 1099/1096 – for reporting non-
employee income – W-2G, 5754, 1097, 1098, 3921, 3922, 5498
• W-9 – to collect names and TINs for
non-employee recipients – W-9S, W-8BEN, W-8ECI, W-8EXP, W-8IMY
• W-4 – to collect names and SSNs for
employees
Forms Needed
Forms You Will Need
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• Publication 15 (Circular E) – Found on the IRS website
• Click on ‘Forms and Publications’
• Instructions to forms– ‘What's
New’ section on 1st page
Helpful Publications
Resources You Will Want
Greatland • We can help answer your
questions or point you in the right
direction
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New Form for 2011
NEW- For This Year
• 1099-K – Merchant Card and
Third Party Network Payments – Income that is reportable on Form
1099-K is not reported on Form
1099-MISC
– Exception for de Minimis
Payments
• Gross amount must exceed
$20,000 for the year, and
• Total number of transactions must
exceed 200 for the year
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• Determine if payments to non-
employee recipients are subject to
reporting on information returns – 1099, 1098, W-2G
• Collect completed form W-4 from
employees or W-9 from non-
employees
• Verify TIN/SSN with the SSA or
IRS
At the Time of Hire or 1st payment
to a recipient
Reporting Timeline
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• Determine how you plan to file forms – Electronically
• Identify the software or service provider that you will be using – Purchase license or apply for logins, password, PIN, etc.
– Paper • Order forms from vendor
– While many vendors guarantee compatibility with your system or
software, it is still a good idea to test out your process ahead of time
» This also allows for you to think of other forms or supplies you
may have forgotten about. Such as envelopes, ink cartridges, etc.
We’ll talk more about filing methods in just a little bit…
Early Fall
Reporting Timeline
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• Records for employees – Sum total wages, taxes, benefits
• Records for non-employees – Sum total payments
• Determine if any thresholds are
met, such as $600 minimums
• Determine which states you will
need to file Forms W-2/1099 – Verify that you’re registered in the
state
At Year-End
Reporting Timeline
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• Complete W-2 & 1099 to
submit to recipients – Forms need to be postmarked by
January 31st
• Prepare 941 and 940 to
submit to IRS for employees
• Due January 31st (see exception
in February)
January for paper forms
Reporting Timeline
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• If furnishing 1099-MISC to
recipients with amounts in box 8
or 14: – Mail forms to recipients by February 15th
• If filing paper to the IRS: – Submit forms 1099 and 1096 by
February 28th
• If filing paper to SSA: – Submit forms W-2 and W-3 by
February 29th
February for paper forms
Reporting Timeline
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• If filing electronically to the
IRS or SSA – Due date is April 2nd 2012
• March 31st is the general due
date, which happens to fall on a
Saturday in 2012
March/April
Reporting Timeline
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• For employees’ income: – Send Forms W-2 to the state
(and locally if applicable) of
residence
• For non-employee
income: – Determine whether the state
requires 1099 form reporting
or not
State and Local Reporting
State and Local Reporting
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State Reporting
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• Form W-2 – IRS compares income on W-2 to income reported on
personal tax return (1040)
– SSA used SSN to post earning for future social security and
Medicare benefits
• Information returns that are subject to Backup
Withholding: 1099-B, DIV, INT, K, MISC, OID,
PATR – Prevents receipt of backup withholding notices (CP2100)
and penalty notices for failure to submit valid name and TIN
data on recipient
Why Verify TIN?
TIN Verification
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• Online – Social Security Number Verification
System (SSNVS) – Allows you to enter up to 10 names and SSNs for
immediate results, or
– Upload overnight files with up to 250,000 names and SSNs.
• Response for this method is typically 1 business day
– Available only to employers or third-party submitters
and only for verification of current and former
employees
To Verify TIN:
TIN Verification
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• Phone – Telephone Number Employer
Verification (TNEV) – An automated phone system that allows you verify up to 10
names and SSNs at one time
– Available only to employers or third-part submitters and only
for verification of current and former employees
• Interactive and Bulk Online TIN Matching
Programs – Publication 2108A
– Only for income types subject to backup withholding
– Online at the IRS eServices site
To Verify TIN:
TIN Verification
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Form W-2 DON’Ts
Common Errors to Avoid
• DON’T include the dollar sign or commas in the money field
• DON’T make copy too light
• DON’T print too small or too large – use 12pt courier font if possible
• DON’T complete forms by hand
• DON’T inappropriately check the ‘Retirement Plan’ checkbox in box
13
• DON’T misformat the employee’s name – 1st name and middle initial in 1st box
– surname in 2nd box
– suffix in 3rd box
• DON’T staple, tape, or fold forms
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• DO use black ink when filing out forms
• DO include the decimal point and cents in monetary entries
• DO file forms alphabetically by employees’ last names or
numerically by SSN
• DO send the whole Copy A page with Form W-3 to the
SSA…even if one of the forms on the sheet is blank or voided
• DO print all recipient copies (B, C, and 2)
on perforated paper
• DO send forms in a flat mailing
Form W-2 DOs
Common Errors to Avoid
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• DON’T send the same information to IRS more than once
• DON’T use dollar signs ($), ampersands (&), asterisks (*), commas
(,), apostrophes (‘) or other special characters in monetary entries or
in the payee name line
• DON’T cut or separate Copy A of 1099 Forms that are printed 2 or 3
to a sheet
• DON’T send photocopies of any forms
• DON’T staple, tear, or tape any forms
Common Errors to Avoid
Form 1099 DON’Ts
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• DO type or print entries with black ink only
• DO verify that name/address/TIN on 1096 and 1099 match
• DO include the decimal point and cents in monetary entries
• DO verify that the filer’s name, address, and taxpayer identification
number (TIN) are the same on both Form 1096 and the attached
Forms 1099
• DO submit a separate Form 1096 with each type of return
• DO use pre-printed red drop-out ink forms when
filing Copy A of Forms 1099 with IRS
• DO print all other copies of Form 1099 on
perforated paper
Common Errors to Avoid
Form 1099 DOs
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Collect name and TIN info immediately
Verify name and TIN through IRS/SSA
sites
Identify which A/P payments are subject
to reporting
Determine filing method before year-end
Order paper forms early
Purchase software
Register for online services and obtain
logins and passwords
Reconcile wages and taxes and balance
with amounts paid to IRS/state(s)/cities
Reconcile non employee income
Recap: Tips for a Successful Year-End
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Read instructions for the forms you will be completing
Focus on the ‘What’s New’ section
Make sure summary (reconciliation) forms balance with forms being
filed
1096 with 1099 forms
W-3 with W-2 forms
Mail or distribute recipient forms by the due date
Submit forms timely to the IRS/SSA
Watch for and respond promptly to any correspondence from the
IRS/SSA
Recap: Tips for a Successful Year-End
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Filing Methods
Ways to Report W-2 & 1099 Information
• Businesses can file W-2 & 1099 forms by
paper, or electronically (e-file) which is the
federal government’s preferred method – If filing less than 250 of each form, paper filing is
approved
– If filing more than 250 of each form, information is
required to be e-filed
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The choice is between blank
forms or forms preprinted with
images to report your
information
• Software compatibility
• Instructions
• Perforations
• Red copies
Paper Forms
What to look for in a Filing Method…
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Ability to manage data
throughout the year in a
complete software package
• Print to forms
• E-file (Federal and State)
• Corrections
• Full Library
• Add-on services that make your job
easier
Software
What to look for in a Filing Method…
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Options to easily complete all
reporting requirements in one place
• Federal, State, and Recipient filing
• Enter forms data online or import
from software
• Federal & State e-filing
• Secure and authorized by IRS
• Fast and easy status tracking
Online
What to look for in a Filing Method…
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Print Blank and
Preprinted
W-2 & 1099
Forms
Greatland’s Filing Solutions Complete W-2 & 1099 reporting solutions for Federal, State and Recipient Filing
W-2 & 1099 Filing Solutions
Software
WinFiler and
WinFiler Plus
Desktop Software
Online
speedEfiler.com
Plus, general W-2 & 1099 knowledge and guidance!
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Questions? Comments? Contact Greatland:
EMAIL: [email protected]
ONLINE: www.Greatland.com
FACEBOOK: facebook/GreatlandCorp
TWITTER: twitter@GreatlandCorp
YOU TUBE:
YouTube/GreatlandCorporation
LINKED IN: Greatland
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Valuable Resources
IRS Small Business and Self-Employed
Tax Center: http://www.irs.gov/businesses/small/index.html
Social Security Administration: www.ssa.gov
Register for SSNVS: www.ssa.gov/bso/bsowelcome.htm
Register with IRS eServices for TIN
matching:
https://la2.www4.irs.gov/e-services/Registration/index.htm
Greatland’s W-2 & 1099 Fact Center: http://www.greatland.com/category/resource+center/w-
2+1099+fact+center.do