Once a year you face the task of reporting to the government income paid out to some Vendors, Businesses and Owners, and to all Employees. This guide is intended to help you process these reports quickly and easily.

The good news is that this is merely a reporting function. In most cases, all you are going to do is print out information about money actually paid out over the course of the calendar year. Based on your business set up, the FRS software has been accumulating these totals throughout the calendar year.

If you were an existing FRS client who began the calendar year with zero balances in the files where these statistics are accumulated, or a new client who began during the year and entered beginning balances, the reporting will be very straight-forward.

Following these guidelines will answer your questions in most cases. If we can help you in any other way, please do not hesitate to call the FRS Support Staff at 407-935-9200 or email to support@firstres.com.

1. First Resort recommends copying ALL data files onto a workstation local hard drive or CD, in the event of the need for a future resubmission to the IRS. Copying the files in their current state allows them to be reused to recreate 1099 files in the future if needed. We recommend copying all files to a folder.
2. Verify that your Employee, Owner and Vendor names, addresses and tax ID numbers are current and accurate. FRS reports which will assist you include the W2 report for employee information (Q,R,W from the Application Selection Menu - run them on plain paper for this purpose), the Owner Address Report (P,T,A), and the AP Vendor Listing Report (E,R,C for Property Management Accounts Payable Vendors; C,R,C for Business Accounts Payable Vendors - use the detailed format). Also, verify your Employer Identification Numbers are accurate in system setup of our software.
3. Coordinate with your accountant as necessary to understand your particular needs and requirements. FRS does not tell you what to report, but our software is designed to help you print the forms and create magnetic media (diskette) files as needed. Note: Due to IRS changes to both hard copy and magnetic media file formats, it is necessary to use FRS version 10.03 or higher when creating magnetic media 1099 files. NewFRS may not be used to create either hard copy or magnetic media 1099s.
4. Contact your IRS District Office to obtain the Instructions and/or forms that apply to your business. Reporting by Magnetic Media requires that you apply to the IRS well in advance of the due date of the returns. 1099 and W2 Forms are commonly ordered through your business’ normal forms supply source. They may also be ordered from Western Business Systems at 800-999-0940; this supplier guarantees compatability with FRS. It is not unusual to order up to three times as many forms as needed because of the potential for misaligned printing and the inevitable deadline that might not give you time to get more forms later.

These reports are designed to complete the required IRS forms for distribution to the people and businesses who received certain income from your business. They also produce a hard copy report for the IRS and/or magnetic media (diskette) reports for those clients who are required to use or choose to use that method of reporting.

Generally, January 31^st is a key date for sending 1099’s and W2’s to Recipients (Employees, Vendors, Owners, etc.) and February 28^th for filing with the IRS. Please read your IRS Instructions for exact deadlines that apply to your business, or ask your accountant. When you create your 1099 and W2 Statements and Reports will be determined by your particular needs and resources.

Have you verified your Employee, Owner and Vendor names, addresses, and tax ID numbers? If not, begin by doing so now. NOTE: to tell the difference between tax ID types (the IRS calls it a TIN#), the data field in our system expects the number to be entered with appropriate dashes. For example, an individual Social Security Number (SSN) must look like nnn-nn-nnn and a corporate or partnership Employer Identification number (EIN) will look like nn-nnnnnnnn. Our system tells the difference by the placement of the dash in the third or fourth position.

IRS regulations require the removal of titles from recipient names. If you have placed titles such as Mr., Ms., or Dr. in any Owner names they must be removed prior to producing 1099s, then replaced afterwards!

Read the IRS Instructions or ask your accountant for advice on missing or inaccurate tax ID numbers.

A sufficient supply of blank 1099 and W2 forms are required for reporting (see "First Things First" on Page 1 of this document). In current versions of our software, both laser and dot matrix printer forms are supported. Magnetic Media reporting may be required for your business. In order to use this type of reporting, you must have applied to the IRS in advance, at least 30 days before the due date of the returns (45 days in some cases). You should call your IRS District Office for details and guidance.

From the main menu, select P (Property Management Functions), T (Print Labels, 1099s, …), Y (Print 1099’s for Owners). The following screen will appear:

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1. Enter P to PAUSE to view each 1099, select only certain records to report, and/or edit the income amount and tax ID for each owner before printing; OR enter an "A" to select all and enter the minimum income level which will be reported (see the IRS Instructions or get accountant advice).

2. You can select to exclude printing 1099s for Corporations (any record that has a tax ID number with a dash in the third position – be aware that choosing this option will also exclude printing 1099s for Partnerships).

3. You can also select to exclude printing 1099s for any record whose tax ID number is blank. Read the IRS Instructions or ask your accountant for advice on missing or inaccurate tax ID numbers.

4. Enter "N" if you are going to report to the IRS by supplying a copy of the forms. Enter "Y" to output 1099 information to a file if you are going to report to the IRS via magnetic media (disk) and this is your final run. NOTE: If you are printing a trial run of your 1099’s, then leave this field as "N", even if you are required to submit information via disk. Note: when answering ‘Y’ to output 1099 information to a file, be sure to select one of the available ‘Display, Print, View’ options at the bottom of the screen; do not attempt to utilize a hidden option ‘F’ to save to a file or combined magnetic format and paper format 1099 information will be sent to the file and it will be rejected by the IRS.

5. The next two fields, Payer Name Control and Transmitter Control Code, are furnished to your business by the IRS if you are going to report by magnetic media. If you are not reporting by magnetic media, you may leave these two fields blank.

6. Next you should select to Display, Print, View, or Cancel the 1099 printing process. The Display option will show you the information that will be printed, however, it is not in the format of the 1099 form. The Print and View options will output in the format required for the form. You can print to plain paper for any trial runs and still be able to print to the 1099 form later.

If a "Y" was entered in "Output a 1099 file to disk for magnetic media reporting", a prompt will appear on one of the following screens "Enter the file name to put the report in". When this message appears, you should enter IRSTAX.O05 (Owners, 2005). IRSTAX should not be used without an extension because the IRSTAX name must be used on each disk submitted to the IRS (i.e., owners, vendors, W2). This will create a file with that name in the \ACCOUNTS directory of your system (or in whatever directory the software is located.). This file should be copied to a disk after the final run of 1099’s are completed. You will also see the following screen:

Please verify the following Fields

Business Name	:BUSINESS NAME :
Address	:ADDRESS :
City State Zip	:YOUR CITY :ST:ZIP CODE:
Phone	: PHONE :
Reporting Year :2003:	Tax ID : ID NUMBER :
Contact Person	: :
Payer Name Control	:CODE:
Transmitter Control Code	:123435:

Original Indicator :1: Replace Indicator : : Correction Indicator : :

You must specify a Contact Person. If you input your Payer Name Control and Transmitter Control Code on the initial 1099 input screen, their values will show on this screen. If you did not input this IRS-supplied information on the initial 1099 input screen, be sure to do so now. For initial submissions to the IRS, leave the 3 indicator fields at the bottom of the screen at their default values. The Replace Indicator and Correction Indicator fields are for use when re-submitting magnetic media files to the IRS. Be sure to send each file to the IRS on a separate diskette or they will be rejected!

If you selected "P to PAUSE to allow for 1099 selection", each account will be displayed. Although you may select M to Modify (like an Edit command) to correct the amount or tax ID information shown, this will not print out properly for owner 1099s. Instead, please use the 1099 override feature found on the owner setup screen (P,A,O) to manually change owner 1099 amounts. If used for vendor 1099s, any changes you make will also update the vendor records. You can also select S to Skip printing a 1099 for this owner, you can select P to Print a 1099 for this owner, or you can press C to Cancel the process.

If you selected P to Print any time during this process, you will be prompted to select the printer where the forms are located, then you will be prompted with a screen that allows you to print a void 1099 to verify alignment (V), to begin printing 1099 forms (P), or to select the type of 1099 you are using, laser or dot matrix, (T). If you are using Laser 1099’s, then select the option for 8.5 X 11 Preprinted Laser Form. Once this form type is selected, then two more options will appear on this screen. One is to print the Instructions for Alignment (A), the other is to set the printer alignments (S). Please print and follow the alignment instructions before proceeding or your 1099s will not print properly. When you press A to print the instructions, your screen will not change, nor will you see the normal "P to Print" reminder. This instruction page also serves as an alignment template. Use it together with a blank 1099 form to determine the correct alignment as indicated in the instructions.

After all 1099’s have been printed, you will be prompted to print the 1099 totals report. Either change the paper in the printer indicated to plain paper, or select to change the printer that the report should go to.

Tip: Do some of your owner 1099s seem to not be printing? First, check for the presence of a 1099 override value in P,A,O for affected owners. If this condition exists, visit P,A,S for that unit and check the value of the INCOME category. If the value is zero, the system will not 'see' the override entry in P,A,S. To fix, edit the INCOME value to some non-zero amount.

PRINTING VENDOR 1099’S

Complete these statements and magnetic media reporting in the same manner as the Owner 1099 instructions given previously. The menu options are E-R-Y or C-R-Y depending on your business setup options.

The only difference between printing Owner 1099s is the "Y" screen where you choose which year to print 1099’s, Previous or Current. If you are reporting to the IRS via magnetic media, a good name to use for the file when prompted is IRSTAX.V05 (Vendors, 2005).

Printing W2 statements and reports is similar to the process for 1099’s. From the main menu, select Q (Payroll Functions), R (Print or Display Miscellaneous Payroll Reports), W (Print Employee W2’s). The following screen will appear:

Verify that the Federal EIN and State Employer numbers at the bottom of the screen are correct. If they are not correct, then edit the numbers on Screen 1 of System Setup before proceeding.

Enter the year for which you want to produce W2’s. Leave the next field at zero to print W2’s for all employees or enter an employee number to begin with if necessary.

The next two fields are used only if you are required to report to the IRS via magnetic media.

Enter "N" if you are going to report to the IRS by supplying a copy of the forms. Enter "Y" to output W2 information to a file if you are going to report to the IRS via magnetic media (disk) and this is your final run. NOTE: If you are printing a trial run of W2’s, then leave this field as "N", even if you are required to submit information via disk. In the next field, enter your state FIPS numeric code to be included in the magnetic media reporting as furnished by your state. If you are not reporting by magnetic media, then leave this field blank.

Next you should select to Display, Print, View, or Cancel the W2 printing process. The Display option will show you the information that will be printed, however, it is not in the format of the W2 form. The Print and View options will output in the format required for the form. You can print to plain paper for any trial runs and still be able to print to the W2 form later.

If a "Y" was entered in "Output a 1099 file to disk for magnetic media reporting", a prompt will appear on one of the following screens "Enter the file name to put the report in". When this message appears, you should enter W2REPORT.W05 (W2’s, 2005). W2REPORT should not be used without an extension because the W2REPORT name must be used on each disk submitted to the IRS. This will create a file with that name in the \ACCOUNTS directory of your system (or in whatever directory the software is located). This file should be copied to a disk after the final run of W2’s are completed.

If you selected P to Print any time during this process, you will be prompted to select the printer where the forms are located, then you will be prompted with a screen that allows you to print a void W2 to verify alignment (V), to begin printing W2 forms (P), or to select the type of W2 you are using, laser or dot matrix, (T). If you are using Laser W2’s, then select the option for 8.5 X 11 Preprinted Laser Form. Once this form type is selected, then one more option will appear on this screen to set the printer alignments (S). You can adjust the left and top margins as necessary in order to get the W2 forms to align properly.

After all W2’s have been printed, you will be prompted to print the W2 totals report. Either change the paper in the printer indicated to plain paper, or select to change the printer that the report should go to.

MAGNETIC MEDIA

If you are not reporting to the IRS by magnetic media (diskette), then skip this section.

Copying to the diskette:
You are ready to do this step if you have printed your final copy of 1099s or W2s and have created the files for each as instructed previously. Separate diskettes are required for each file you are reporting! For instance, if you are filing W2, Owner 1099s and Vendor 1099s by magnetic media, then you will need to copy each file onto its own diskette (3 total). Verify the file names in the instructions you receive from the IRS for filing by magnetic media. You will need formatted disks before you proceed.

From a DOS prompt, change to the appropriate drive by typing the drive letter followed by a colon, eg. F: if on a network, and then press the Enter key (Note: ‘host’ PCs on Peer-to-Peer networks will find FRS data on the C: drive, while other PCs on such networks will find FRS data on the F: drive. Contact FRS support if you are uncertain about the location of your FRS data). Next, change directories to the \ACCOUNTS directory (or whatever directory holds our software) by typing ‘cd \accounts’. Then type ‘copy irstax.O05 A:’ if the formatted disk is in your A drive and the file name to be copied is IRSTAX.O05. (There is a space between the O05 and the A.) Repeat the same procedure for any of the files which your business may be reporting on diskette.

Refer to the IRS Instructions or your accountant if you have any questions on report content. Call FRS Support Department if you have more questions on running the reports within our software.