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News You Can Use About W2 Reporting

New for CY2020?  The ability for a district to submit their own W2 submission files.   This must be a mutual decision between the ITC and the district as there is additional setup required for this option to be available.

Updates have been made that will now allow the user to create their own W2 submission files that contains all pertinent data required for uploading. This will hold true for the SSA, RITA, CCA, and City options. We have also added the capability of creating State submission files for a variety of surrounding states. You can go to Reports>W2 Report and Submission>W2 State Options and choose which state you would like to create a submission file for by clicking the bubble next to the state. Available states are-Ohio, Indiana, Kentucky, Michigan, Pennsylvania and West Virginia. Each state setup requires different data so it must be populated accordingly. The ITC and district will need to determine who will be submitting the tape file to the other states. 

Login accounts are required to be able to upload your file to the appropriate sites.

For the SSN file, an account must be set up on Business Services Online (BSO)- https://www.ssa.gov/bso/bsowelcome.htm  

For RITA-https://www.ritaohio.com  Electronic submission is required if 250 or more W2's have been issued for RITA

For CCA-http://ccatax.ci.cleveland.oh.us/  Electronic submission is required if 100 or more W2's have been issued for CCA

For the state of Ohio, an account must be set up on Ohio Business Gateway (OBG)- https://gateway.ohio.gov/wps/portal/gateway/BusinessGateway/Home

The state of Ohio encourages all employers to submit their W-2 information electronically regardless of how many W-2 forms have been issued.

For Indiana-https://intime.dor.in.gov/eServices/_/  Electronic submission is required if 25 or more W2's have been issued for Indiana

For Kentucky-https://revenue.ky.gov/Business/Pages/Employer-Payroll-Withholding.aspx  Electronic submission is required if 25 or more W2's have been issued for Kentucky

For Michigan-https://mto.treasury.michigan.gov/eai/mtologin/asuthenticate?URL=/  Electronic submission is required if 250 or more W2's have been issued for Michigan

For Pennsylvania-https://www.etides.state.pa.us/ESignature/Account/LogOn  Electronic submission is required if 10 or more W2's have been issued for Pennsylvania.

For West Virginia-https://mytaxes.wvtax.gov/_/  Electronic submission is required if 25 or more W2's have been issued for West Virginia.

FFCRA and W2 Reporting

Fields have been added to the Federal (001) Payroll Item record that will allow for FFCRA (Families First Coronavirus Response Act) data to be entered for reporting on the W2 Report and the employee W2. These fields can be populated with the sick leave pay amount that was utilized for COVID-19 related purposes. All related information must be tracked by the district on a spreadsheet and can then be manually entered or Mass Loaded on the Federal 001 Payroll Item. *Note this data will only appear on the W2 Report as well as in Box 14 on the Employee's W2. The data is NOT submitted on the tape file and would need to be reported using Worksheet 1 for the 941 https://www.irs.gov/pub/irs-pdf/i941.pdf. (Remember that since most school districts do not withhold Social Security they more than likely would not qualify for a reimbursement)

A covered employer must provide to an employee that it has employed for at least 30 days

• Self- Amount that can be entered allows for 2 weeks (up to 80 hours) of paid leave at the regular rate of pay, $511.00 per day limit. If employee is unable to work because the employee is quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis.
• Other-Allows for 2 weeks (up to 80 hours) of paid sick leave paid at 2/3 the employees regular rate of pay, $200.00 per day limit. If employee is unable to work because of a bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor.
• Emergency-Amount that can be entered allows for up to 10 additional weeks of paid expanded family and medical leave at 2/3 the employee’s regular rate of pay. If employee is unable to work due to a bona fide need for leave to care for a child who’s school or child care provider is closed or unavailable for reasons related to COVID-19.

This information (up to 3 options including Vehicle Lease) will be available in Box 14 on the W2. Defined as the following on the W2. If Vehicle Lease is defined and employee has all three COVID codes defined only Vehicle Lease, Self COVID and Other COVID will appear in box 14.

• COVID-SE 
• COVID-OT
• COVID-EM

News You Can Use About 1099 Reporting

The ability for a district to submit their own 1099 submission files is available in USAS-R.   However, this must be a mutual decision between the ITC and the district as there is additional setup required for this option to be available.

1099-NEC

The PATH Act accelerated the due date for filing Form 1099 that includes nonemployee compensation (NEC) to January 31 and eliminated the automatic 30-day extension for forms that include NEC. Beginning with tax year 2020, you must use Form 1099-NEC to report nonemployee compensation.  Click here for further information on IRS website regarding Forms 1099-MISC and 1099-NEC.  

1099 Preparations

In order to prepare for 1099 season, we recommend reviewing and verifying your 1099 vendor data.  This includes confirming Tax ID Types and Vendor ID#s are filled in and correct, as well as ensure their Type 1099s and 1099 Locations are correct.  There are a couple of reports available to verify your 1099 data.  The SSDT 1099 Vendor Report includes vendors with a Type 1099 specified, sorted by Type 1099,  The report includes the 1099 Address information, Tax ID Type, Tax ID#, YTD Taxable and YTD Total amounts.  The 1099 Extract program has an option to 'Print 1099 Report'.  In order for this option to be available, the December reporting period must be created.  This report provides a preview of the vendor data that will be included when processing your 1099s.  You can also customize your vendor grid, adding 1099-related columns to it, filtering and using the report button to generate  your own custom 1099 vendor report.   The YTD taxable amounts on the vendor record will be included on the 1099s.  If a manual adjustment is needed on a vendor's YTD taxable figure, please refer to the 'Did You Know' sidebar article in this newsletter for further information. 

1099 Extracts

We have updated the 1099 Extracts program under Periodic to accommodate the new 1099-NEC and updated 1099-MISC forms.   You may checkmark 1099-NEC and/or 1099-MISC return types which will enable the 'Generate Extract File' option.  The Output File Type (IRS or XML Format) selected will determine the extract file created.  For further information on generating your 2020 1099s, please contact your ITC.  They will provide a CYE checklist with specific instructions on the steps needed to generate and submit 1099s for your district.  Please refer to the 1099 Extracts documentation for further information on the options available in the program.

Deceased Employees Final Payment Processing

Listed below are some important facts pertaining to processing a final payment for a deceased employee:

Important Fact

• Wages that were constructively received by the employee while he or she was alive are reported on Form W-2 as any other regular wage payment, even if you may have to reissue the payment in the name of the estate or beneficiary.

Processing Facts

• If the payment was processed in the same calendar year the employee died, you must withhold social security and Medicare taxes on the payment and report the payment on the employee’s Form W-2 only as social security and Medicare wages to ensure proper social security and Medicare credit is received.

• If the payment was made after the year of death, (i.e. employee died in 12/2019 and payment to estate is being processed in 1/2020), do not report it on Form W-2, and do not withhold social security and Medicare taxes.

Reporting of the payment

• Whether the payment is made in the year of death or after the year of death, you also must report it in Box 3 of Form 1099-MISC, Miscellaneous Income, for the payment to the estate or beneficiary. Use the name and taxpayer identification number (TIN) of the payment recipient on Form 1099-MISC.

Please refer to the USPS-R Deceased Employee Final Payment documentation for further details.