First Option Newsletter

December 2020


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We are getting to the end of 2020 and it's time for our annual newsletter. 

This year, there are major changes to the 1099 filing process which will now break out non-employee compensation, which used to be recorded in (box 7) on a new separate form called 1099 NEC. Non-employee compensation of 600.00 or more will be now recorded in box 1 of this form. 

All other miscellaneous income will be on a second form 1099 MISC. This form is the same as last year with the IRS re-arranging a few boxes. Boxes for Rents, Royalties and other income remain the same. Click for form

Please note, we are only supporting Laser forms this year. Please contact the helpdesk for installation instructions for 1099 filing. 

The deadlines for filing W-2s remain the same as last year.

State Filing
It is important to note that e-filed Form 1099-NEC will not be forwarded to states. 

In September, the IRS released its annual Publication 1220, which revealed that the 1099-NEC will not be included in the IRS 1099 Combined Federal/State Filing Program (CF/SF).
Under the CF/SF Program, the IRS forwards data from a number of key forms to the appropriate states, but it will not do so for Form 1099-NEC. As a result, businesses could miss key state filing deadlines, leading to unexpected penalties. This means 1099-NEC filers will need to file states manually.

For year end, we have some sample knowledge base entries that you may find helpful and have added our holiday schedule for 2021.

And lastly, we have included 2021 Federal Wage Limits and 2021 Retirement Plan Contribution limits as well as the 2021 FOI holiday schedule. 

Happy Holidays!

Wishing you peace and good health in the New Year.

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refer
2021 Deadlines for W-2s and 1099's
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deadline
Businesses are required to file their copies of Form W-2, submitted to the Social Security Administration, by January 31st 2021. 
Note: New filing dates for 1099's
Form 1099-NEC should be filed with the IRS on paper or electronically by February 1st, 2021.
Form 1099 MISC should be filed with the IRS on paper by February 28th 2021, or March 31st, if filing electronically.

 
 KB2Knowledgebase Entries
Year End Knowledge Base Entries
1099's

Question:
What options do I use to print 1099-NEC and 1099 MISC?
 
Resolution:  
 
Note: There are new programming changes to support 1099-NEC and 1099 MISC as well as new filing deadlines. 
 
 


Accounting Period Open/Close
 
Question:
How do I change the G/L accounting period open/closed flags if I have already cloned them from a previous year?
 
Resolution:
To access and change the Valid for General Ledger fields in the Accounting file, and if you have cloned the accounting period and therefore copied the Closed period fields;
Use #14-Update Accounting Period Flags on the G/L  Supervisor menu.  
Enter the Corp# and year that need to be changed and press ENTER.  In the column 'Valid for G/L' key a 'Y' to allow entries to be posted into the period or an 'N' to prevent entries from being posted.  


Accounting Period Open/Close (cont.)

For more information about accounting periods, cloning and re-setting values go to the General Ledger Manual page 25 & 126.


Open New Year

Question:
How do I open a New Year for Accounts Payable and General Ledger?


Resolution:
Create the accounting period for each Corp/Fund for the new year. (this example is from 2020 to New Year 2021)
You can easily clone from one year to the next using Option 18 -Clone Accounting Periods, from the General Ledger File Maintenance menu.
You will need to key in the Corp/Fund and the "from" year 2020, then the same Corp/Fund and the 'To" year 2021, at the copy period closed area, key in a "N" and the following fields will appear.

From Corp# : 2 To Corp# : 2 

From Year : 2020 To Year : 2021

Copy Period Closed Data . . . .: N (Y,N) 


Set 12 months to Yes or No 
Valid For GL . . . . . : Y 
A/P Closed . . . . . . : N 
A/R Closed . . . . . . : N 

Set the Valid for GL, AP Closed, and AR Closed as shown above. You will need to do this for all Corps/Funds.





2021 Federal Wage Base Limits
Fed
Social Security (6.2%)142,800 (up from 137,700)
Medicare (1.45%)No Limit - an additional 0.9 % will be added for individuals who make 200,000 plus and couples filing jointly at 250,000 plus.
Federal Unemployment (FUTA)7,000 (same as last year)


 

2021 Retirement Contribution Limits
cont
401k19,500
Roth 401k, 403(b), SARSEP, 45719,500 
Catch-up 401k, 403(b), 457 6,500 

 
2021 Holiday Schedule
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holiday
Click the link below for our 2021 Holiday Schedule.


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First Option

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http://www.1stoption.com