A common task for most Microsoft Dynamics AX 2012
implementations is to update the current year vendor information
for 1099 reporting. Initially, the 1099 vendor transactions will need to
be migrated to Microsoft Dynamics AX 2012; however, there should
be no update to the general ledger. The following is an example
of a process to manually enter a sample 1099 vendor invoice (this
will be imported via a ledger journal template during cutover) and
manually recording the payment to the vendor. The 1099 balance will
be verified after posting on the vendor record. A 1099 summary and
detail report will be run from Microsoft Dynamics AX 2012 to verify
the 1099 balances are captured and reported correctly.
Key Requirements and Assumptions:
A general journal will be used to record the 1099 vendor AP
invoice. The AP invoices will be imported using the ledger
journal data migration template.
The 1099 vendor balance migration should be imported before
the open AP import.
- 1099 vendors must be indicated to “Report 1099” on the master
vendor record within Microsoft Dynamics AX 2012. A federal
tax ID is also required. If necessary, a “doing business as” name
and a 1099 box would be specified for the vendor.
- A “1099” journal name will be created and used for the imported
1099 vendor invoices. By using the 1099 journal name, it is
possible to identify the general journals that were created for the
loading of 1099 balances.
- The migration of 1099 vendor balances will not impact the
This will be accomplished by first crediting the vendor account
and debiting a specified AP account when recording the invoice.
Then, during payment, debit the same vendor account and credit
the same AP account for the same dollar amount during payment.
»» When recording the payment, the 1099 field must be populated
with the same dollar amount on the corresponding vendor
invoice. Create a new 1099 method of payment to allow for
separation of transactions. Also, create a new 1099 number
sequence to use specifically with this journal name.
- The 1099 vendor invoice will then be paid by using the payment
proposal process in the AP module. A payment journal will be
created, and then, by using payment proposal functionality, the
invoice will be transferred to the payment journal for each 1099
vendor. Create a “1099P” journal name; it is also necessary to
create a journal name to be used for the 1099 vendor payment.
This journal name will be used in the AP payment journal. It will
also have the same default AP account offset, and use the same
voucher series as the “1099” journal name previously created.
- Open AP would be zero after this 1099 migration process, and the GL
will not be impacted. There will be no open transactions remaining
in Microsoft Dynamics AX 2012 after the payments are posted.
»» The 1099 balances and transaction history will exist for each 1099
vendor after this process is run within Microsoft Dynamics AX 2012.
Standard Microsoft Dynamics AX reports may be used to verify the
Tax 1099 summary and detail for each 1099 vendor.