In the USA – as I understand it – if a business pays over $600 per calendar year to a physical person or a legal entity (“1099-recipient supplier”) that is not a corporation, the business that made the payments must report the total to the Internal Revenue Service and to the 1099-recipient supplier after the end of the calendar year.
My questions are this: (1) Does Manager have a way of tracking this when the expenses were paid by employees or owners and handled by the Expense Claims feature? (2) Does Manager have a way of tracking this when the expenses were recorded via the “Purchase Invoices” functions?
Example: let’s say Owner Joe buys goods or services for his business several times (and pays for them out of his own funds) from the same sole proprietor (“Seller Bob”), and by the end of the year, Owner Joe has spent over $600 buying goods or services from the sole proprietor (Seller Bob) and Expense Claims are done in Manager for all of those purchases. Is there some way to “flag” those transactions in Manager, so that once the threshold of $600 is met, a report will be available to Owner Joe that his company needs to provide a Form 1099 to Seller Bob and the IRS?
(I think the best way would be if the “Payee” on the Expense Claims could be populated from the Suppliers list and the Suppliers list could have a flag that that supplier is a 1099-recipient supplier. In that case, once the threshold is met by transactions in “Purchase Invoices” plus transactions in “Expense Claims”, a report should be available. But I see no way to populate the “Payee” in an Expense Claim from the data entered for Suppliers.)
Has anyone else in the USA who is using Manager dealt with this? How do you do it?
This could be done using Advance Queries but you have to manually check which person is exceeding 600$ limit.
You can select account payable and then Supplier on Line of Expense Claim.
Btw for flagging you can create a Custom Field (Checkbox would be fine) with Placement at Supplier and Expense Claim Lines or you can place it anywhere like Payments employes etc. Then go to supplier and check the custom field. Then whenever Supplier is selected on line of a transaction that custom field will be automatically populated.
Probably one could just flag all suppliers that are not C-Corporations (since all suppliers that are not C-Corporations – I think – are the ones that have to get 1099 forms). Then when the list is done, one could just ignore those from which was purchased less than $600 worth of goods/services.
Thank you. I think I understand some of it, but not all.
I wonder why someone would put “Accounts Payable” in the Expense Claim. I realize it is done to get the amount in the data associated with the supplier called “Supp 1”, but won’t that distort the accounting?
In any case, I think I’ll wait on finding a solution to this issue for now and revisit it after there are more transactions, maybe even starting in 2025. For 2024’s accounting, I think we can probably aggregate the data we need manually.
I suggested this because you wanted to select Supplier as Payee.
And i selected accounts payable because someone paid your supplier on your behalf. You can create a purchase invoice for the goods/services you have received from you supplier.
If you are not getting purchase invoice from you supplier then it only between you and expense claim payer then you have select only the expenses on lines of expense claim. You can record the name of supplier but it will be just for reference.
Btw you can search the forums i think this 1099 isuue has been discussed previously.
OK, I think I understand, and I think I like that approach. We have an invoice that the owner got when he bought the items. As I understand what you said, we can enter it in as normal purchase invoice and then use the debit line (to Accounts payable) in the Expense Claim as the way to reduce that liability. And the transaction could be tracked for 1099 reporting if we set up the special fields. I think that is a very good solution. I’ll do some testing (if I find time) to see if it all works as I think it will.
