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    January 16, 2023

    Microsoft Dynamics GP Year-End Close: AP & 1099 Processing

    Knowing how to close out your Microsoft Dynamics GP instance can be difficult if you don’t know best practices and how to streamline the process. At Enavate, we put together a webinar series and connected blogs to assist you with just that, letting you in on the tips and tricks that’ll make your Year-End Close process more efficient.  

    This session will cover: 

    • Payables Closing Best Practices 
    • GP Versions Impact for 1099 Processing  
    • Options for Making Updates and Edits to 1099 Details
    • How to Efficiently Process 1099s 

    If you want to follow along or watch the webinar instead, you can do so here:  

    HubSpot Video

    Dynamics GP Payables Closing Best Practices 

    Payables Year-End Close is an optional step and is NOT required to run 1099s. It’s not unusual for some companies to never close out prior years of payables. You can still process your 1099s if you choose not to do this step.  

    Things to Consider 

    If you choose to run the Year-End Close process in the purchasing model, timing is very important. You will not be able to post your Payable transactions to the new year prior to closing out the module if you depend on YTD and LYR buckets in SmartLists. 

    Year-To-Date (YTD) columns and Last Year (LYR) columns in the SmartLists are affected by when the Payables module is closed. However, you can enter transactions into batches and wait to post until after you have run Year-End Close.  

    If you posted a Payables transaction into the new year prior to closing, Enavate can assist you with running SQL scripts to recalculate your YTD columns.  

    Close the Purchase Model 

    To close the Purchase Model, follow these steps: 

    Navigate to: Purchasing > Routines > Year-End Close  

     Picture1-Jan-16-2023-02-28-20-7833-PM

    You may choose to print the Year- End Close report during this process if you do, be sure to print to PDF as it can be a lengthy report.  

    GP Version Changes and Options  

    NOTE: If you’re currently running Dynamics GP 2016 or earlier, there are no Year-End Close options for 2022. These versions have reached their end of life in terms of updates. We recommend using Greenshades or another 1099 processing option online if you’re using this version or earlier. 

    If you received the Year-End update in 2020, you received a significant update to include the new 1099-NEC form. The IRS took the 1099 miscellaneous form and broke it out into two forms. One is the non-employee compensation. The second is the miscellaneous form, the IRS completely removed line seven from this form. 

    The 2021 Year-End update included the 1099-NEC with three forms to a page. This update allowed users to run 1099-NEC out of GP three to a page.  

    2022 Year-End Update 

    GP has implemented new changes in 2022 that stem from the IRS. The new update is inclusive of prior updates 18.2, 18.3 and 18.4. The update includes: 

    • 1099-INT, 1099-DIV, 1099-MISC, 1099-NEC 
    • The update adds the year to dynamically print on the form (IRS removed this from the pre-printed form). You will have to manually input the year. 
    • 1099-MISC & 1099-DIV 
    • Account Number has moved down a box, FACTA filing has moved over, and 2nd TIN has moved down a box 
    • Fixed Assets 
    • Luxury automobile depreciation changes were updated 
    • 1095-C Employee ACA  
    • The form has instructional changes only (back page)  

    NOTE: There are NO Payroll changes (W2, W3, EFW2). With the update, you can now print the 1099- NEC form with lines. 

    What if you can’t update to 18.5 before the Year-End Close? 

    If you’re running GP versions up to 18.3, we recommend that you contact our third-party partner, Greenshades, for their 1099 service or you can search online for a 1099 Processing Service online.  

    For GP version 18.4, please email Support@Enavate.com to open a case. We can work with you to make the necessary changes needed for the 2022 forms.  

    1099 Edits 

    When figuring out how to process your 1099s, it’s a good idea to keep the following in mind:  

    Print your 1099 Edit List 

    Purchasing > Routines > Print 1099 

    The form should automatically insert your company name and Fed ID, but you can manually enter it if needed.  Picture2-Jan-16-2023-02-29-03-2012-PM

     This is an important report to run to make sure that you have an accurate tax ID or social security information for your 1099 vendors. The report supplies you with a dollar amount if it’s above the threshold for the type of 1099 you’re running. Anything below the threshold will not appear. 

    NOTE: 

    If you’re not sure where to set up 1099 minimum thresholds, you can do that here: 

    Purchasing > Setup > Payables > 1099 Setup  Picture3-4

    3 places in GP to edit 1099 data 

    Option 1: 

    Purchasing Cards 

    Purchasing > Cards > 1099 Details 

    To edit 1099 details, you need to display the totals by month. This is the only way to edit 1099 amounts. Once you have made the edits, click save. 

    There are no limits to the number of times you can make changes to 1099s and process them.  

    This method is useful when you need to make a quick adjustment to one vendor. Picture4-3

    Option 2:  

    Purchasing Transactions 

    Purchasing > Transactions > Edit 1099 Transaction Information 

     Picture5-2

    Here, you can make additional changes to your 1099 types by transaction. To make the necessary changes, follow these steps: 

    • Enter an appropriate Vendor ID 
    • If desired, restrict by voucher number
    • Choose to view by 1099 Debit Transactions, All Debit Transactions, or All Credit Transactions 
    • NOTE: Each time you make a change, hit “re-display” to view the changed data 
    • Change the Tax Type and/or Box Number  for a specific transaction 
    • Click “Process” 
    • Verify the information by viewing the changed 1099 information (Cards > Purchasing > 1099 Details) 

    NOTE: The document list shows the invoice date, NOT the payment date, so if there are any invoices from 2021 that were paid in 2022 you need to adjust the date under Documents to include 2021.  

    Option 3: 

    Purchasing Utilities 

    Purchasing > Utilities > Update 1099 Information 

     Picture6-2

    If you need to make blanket changes to all transactions to a different 1099 type or 1099 Box number for one vendor or a range of vendors, follow these steps: 

    • Select the radio button next to “Vendor and 1099 Transactions” 
    • In the “From” restriction on the left do the following:
    • Tax Type the tax type you want to change 
    • 1099 Box Number the box number you want to change 
    • In the “To” restriction on the left do the following: Tax Type the tax type you want the vendor data to reflect 
    • 1099 Box Number the box number you want the vendor data to reflect 
    • In the “Range Restriction”
    • Be sure to enter a restriction here. You can choose between Vendor ID, Vendor Name, and/or Vendor Class. Then click insert to apply the restriction.  
    • If you do not enter a restriction here, GP will   update ALL vendors. This CANNOT BE UNDONE. Be sure you’ve isolated the Vendors or Vendor Class you wish to change. 
    • Verify the changes and then click “Process” to finalize the changes. A report will print to view the changes. 

    Processing 1099s in Microsoft Dynamics GP 

    Once you’re sure that all your 1099 edits are perfect, you can print and process your 1099s.  

    Print with Lines and Boxes Picture7-2

    With the 2022 update, if you’re filing electronically, you may be able to avoid buying preprinted forms, but if you need to file with the IRS on paper, you’ll still need to purchase the forms. The IRS requires the top page, a red form, that can’t be copied or scanned, it has to be the original. You can go to the irs.gov website to read more about it and find the forms here: https://www.irs.gov/forms-pubs/about-form-1099-nec  

    Before printing, verify that the Fed ID is populated, the 1099 year is correct, and select which type of 1099 you’re printing (you’ll have to repeat this process for 1099 NES, miscellaneous, dividends, and others).  

    Choose the order in which you’d like your forms to be printed. The options are Vendor ID, Vendor Name, Vendor Class, or Type. 

       Picture8-2

    We suggest running a few print tests to get everything aligned properly. You can print your test runs on white paper so you don’t waste pre-printed forms, or make a copy of the pre-printed form for your test. 

    Once you’ve printed your 1099s, you’ll need to print the accompanying 1096. Choose the 1096 form in the lower left corner of the window, and then print the form.  

    NOTE: You’ll need one 1096 for each 1099 type you print. Dynamics GP will print an X in the correct box for each type.  

    For any additional questions you may have, we’re here to support you. You can also visit our Enavate Blog, where our consultants regularly post a helpful variety of content.  

    If you need assistance or have needs related to customer care and consulting, please reach out to Support@Enavate.com. 

    For more tips on how to close out your year with less stress, read the other blogs in this series: Year-End Close Process in Microsoft Dynamics GP: Tips and Tricks and Microsoft Dynamics GP Year-End Close: Tips and Tricks for US Payroll. 

    Lynn Fidei

    Lynn Fidei is a Senior Dynamics GP Consultant on the Client Care team. She brings over 30 years of experience in both Microsoft and Finance. Her overall passion is helping others understand and love Microsoft Dynamics GP as much as she does. Working smarter not harder is always her goal! Outside of work, she spends all the time she can with her five grandkids.

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