Friday, October 5, 2012

1099K: How to print and submit new IRS form 1099-K (Credit Card)

I wanted to share a new “10 Step Guide on How to Print Form 1099-K” and then file it with the IRS.

Just like any other information return, the filer will need to send a copy of form 1099-K to each recipient and send the corresponding copy to the IRS.

Due dates for year 2012 / 2013:

Send Copy B of form 1099-K to the recipient by January 31, 2013.
File Copy A of form 1099-K with the IRS by February 28, 2013. 
If you file 1099s electronically, the due date is April 1, 2013.

Tips and Suggestions:

1- Always start preparing 1099s early and do not wait until last minute.
3- Call the IRS Information Return division @ (866) 455-7438 if you have any questions or concerns.
4- Try to e-file to guarantee your forms get received by the IRS.

Happy Tax Season!


#1099K #W2Mate

Monday, October 1, 2012

New Michigan 2012 / 2013 Tax Rates

Effective October 1, 2012, the income tax withholding rate will change to 4.25% and the personal exemption amount will change to $3,950. The pension and/or retirement benefit withholding rate will also change to 4.25%, however, there is no adjustment to the monthly pension deduction amount. Withholding Tables have been updated.

If you are using a payroll system, then make sure to call the publisher to get the most up to date version. If you are doing payroll by hand, I highly recommend you call the state to get the latest withholding booklets.

The latest Michigan withholding tables can be found here:

Monday, October 10, 2011

Form 1099-R Codes : Form 1099-R Distribution Codes

I have been searching for a list of Form 1099-R Distribution Codes, but I could not locate anything complete online, so I went to the IRS website and I created the list below.

  • 1: Early distribution, no known exception (in most cases, under age 59½). Check the back of form 1099-R or the 1099R manual for more details.
  • 2: Early distribution, exception applies (under age 59½).
  • 3: Disability.
  • 4: Death.
  • 5: Prohibited transaction.
  • 6: Section 1035 exchange (a tax-free exchange of life insurance, annuity, qualified long-term care insurance, or endowment contracts).
  • 7: Normal distribution.
  • 8: Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2011.
  • 9: Cost of current life insurance protection.
  • A: May be eligible for 10-year tax option (see Form 4972).
  • B: Designated Roth account distribution.
  • E: Distributions under Employee Plans Compliance Resolution System (EPCRS).
  • F: Charitable gift annuity.
  • G: Direct rollover of a distribution (other than a designated Roth account distribution) to a qualified plan, a section 403(b) plan, a governmental section 457(b) plan, or an IRA.
  • H: Direct rollover of a designated Roth account distribution to a Roth IRA.
  • J: Early distribution from a Roth IRA, no known exception (in most cases, under age 59½).
  • L: Loans treated as distributions.
  • N: Recharacterized IRA contribution made for 2011 and recharacterized in 2011.
  • P: Excess contributions plus earnings/excess deferrals (and/or earnings) taxable in 2010.
  • Q: Qualified distribution from a Roth IRA.
  • R: Recharacterized IRA contribution made for 2010 and recharacterized in 2011.
  • S: Early distribution from a SIMPLE IRA in first 2 years, no known exception (under age 59½).
  • T: Roth IRA distribution, exception applies.
  • U: Dividends and Distributions from ESOP under sec. 404(k). Note. This distribution is not eligible for rollover.
  • W: Charges or payments for purchasing qualified long-term care insurance contracts under combined arrangements.
To learn more about 1099 Retirement Distribution Codes, please visit the IRS website. If you are trying to print or E-File 1099 R forms, you can visit the CPA technology advisor website.

Wednesday, October 5, 2011

1099 DIV Software: 1099 DIV Electronic Filing Record Layout

If you are required to file 250 or more 1099 DIV returns, you must file electronically. If you are required to file electronically but fail to do so, and you do not have an approved waiver, you may be subject to a penalty.

In this post we will cover the 1099 DIV electronic filing layout. You can use 1099 DIV software to generate a file according to IRS Publication 1220.

To learn more about 1099 DIV electronic filing, please visit

and download a FREE 1099 software demo.

1099 DIV Software Download

Amount Codes Form 1099-DIV - Dividends and Distributions For Reporting Payments on Form 1099-DIV:

  • 1 : Total ordinary dividends

  • 2 : Qualified dividends

  • 3 : Total capital gain distribution

  • 6 : Unrecaptured Section 1250 gain

  • 7 : Section 1202 gain

  • 8 : Collectibles (28%) rate gain

  • 9 : Nondividend distributions

  • A : Federal income tax withheld

  • B : Investment expenses

  • C : Foreign tax paid

  • D : Cash liquidation distributions

  • E : Non-cash liquidation distributions

Payee "B" Record - Record Layout Positions 544-750 for Form 1099-DIV

Field Position: 544
Field Title: Second TIN Notice (Optional)
Length: 1
Description and Remarks: Enter "2" (two) to indicate notification by IRS twice within three calendar years that the payee provided an incorrect name and/or TIN combination; otherwise, enter a blank.

Field Position: 545-546
Field Title: Blank
Length: 2
Description and Remarks: Enter blanks.

Field Position: 547-586
Field Title: Foreign Country or U.S. Possession
Length: 40
Description and Remarks: Enter the name of the foreign country or U.S. possession to which the withheld foreign tax (Amount Code C) applies. Otherwise, enter blanks.

Field Position: 587-662
Field Title: Blank
Length: 76
Description and Remarks: Enter blanks.

Field Position: 663-722
Field Title: Special Data Entries
Length: 60
Description and Remarks: This portion of the "B" Record may be used to record information for state or local government reporting or for the filer's own purposes. Payers should contact the state or local revenue departments for payroll software filing requirements. If this field is not utilized, enter blanks.

Field Position: 723-734
Field Title: State Income Tax Withheld
Length: 12
Description and Remarks: State payroll tax withheld is for the convenience of the filers. This information does not need to be reported to IRS. The payment amount must be right-justified and unused positions must be zero-filled. If not reporting state tax withheld, this field may be used as a continuation of the Special Data Entries Field.

Field Position: 735-746
Field Title: Local Income Tax Withheld
Length: 12
Description and Remarks: Local income tax withheld is for the convenience of the filers. This information does not need to be reported to IRS. The payment amount must be right-justified and unused positions must be zero-filled. If not reporting local tax withheld, this field may be used as a continuation of the Special Data Entries Field.

Field Position: 747-748
Field Title: Combined Federal/State Code
Length: 2
Description and Remarks: If this payee record is to be forwarded to a state agency as part of the Combined Federal/State Filing Program enter the valid state code from Part A, Sec. 10, Table 1. For those payers or states not participating in this program, enter blanks.

Field Position: 749-750
Field Title: Blank
Length: 2
Description and Remarks: Enter blanks or carriage return/line feed (CR/LF) characters.

To learn more about 1099 E-File Software and filing forms 1099 Dividends and Distributions electronically please visit

Wednesday, June 23, 2010

New Hire Act- Payroll Software

Washington has recently enacted the HIRE Act (Hiring Incentives to Restore Employment). This new law includes two tax incentives to be claimed by employers who hire workers who were previously unemployed or only working part time. The tax benefits apply to workers hired after Feb. 3, 2010 and before Jan. 1, 2011 and/ or for each worker employed for at least a year.

The first payroll tax exemption involves the employer’s share of Social Security tax on qualified employees starting on wages paid on March 19, 2010. The employer will be exempt from their 6.2% Social Security tax through December 31, 2010.

The second payroll tax credit (hire retention credit) applies in the case of the newly hired workers staying employed for at least a year. Business owners may claim an additional general business tax credit, up to $1,000 per worker, when they file their 2011 tax returns.

Employees must certify by a signed affidavit, under penalties of perjury, that they have not been employed for more than 40 hours during the 60-day period ending on the date they started employment. The IRS has issued Form W-11 that business owners may use as the affidavit. You are allowed to use another similar statement if it contains employee name, Social Security Number, first date of employment and name of employer. The employee must sign it under penalties of perjury.

The IRS has released a modified 2010 Form 941 in order to claim the payroll tax exemption. Employers will start using this form for second quarter 941 filing. The payroll tax exemption is based on when the wages were paid regardless of when the wages were earned. Wages paid to qualified employees during the first quarter from March 19, 2010 to March 31, 2010 are claimed on the second quarter Form 941 as a credit. The amount of the credit will be refunded to the employer or applied towards a liability in a following quarter. The exemption must be claimed on the return for the quarter in which the wages were paid.

Use Form W-11,Employee Affidavit,to confirm that an employee is a qualified employee under the HIRE Act. Claim your payroll tax exemption using Form 941 and Payroll Mate payroll program.

Download a free trial of Payroll Mate small business payroll software .

Monday, February 22, 2010

2010 Form 941- First Quarter

Use Payroll Mate payroll software to print Form 941. 941 Form is a quarterly form used to report wages you have paid,tips your employees have received,federal income tax you withheld,both the employer’s and the employee’s share of social security and medicare taxes, current quarter’s adjustments to social security and medicare taxes for fractions of cents, sick pay, tips, and group-term life insurance,advance earned income tax credit (EIC) payments and credit for COBRA premium assistance payments.

Payroll Mate automatically populates form 941 with payroll information that has been entered in the program. The first quarter 941 form is due April 30, 2010.

Business owners try our free payroll software download easily print Form 941.

Monday, February 15, 2010

Free 1099 Software

It is a busy time of year trying to issue W2/1099 forms,file W2/1099 forms and starting new payroll for the year. As many of you know Payroll Mate includes W2 forms however for those of you who need to issue 1099 forms you may need different software. Deadlines are approaching for filing 1099/1096 forms. The deadline for 2009/2010 is March 1, 2010.

Try this free 1099 software.

W2 Mate supports 1099 MISC, 1099 INT, 1099 DIV and 1099 R forms. This 1099 software will print recipient copies to blank paper and 1099 A/ 1096 data to preprinted red ink laser forms per IRS regulations.