1099 Electronic Filing: IRS Releases E-Filing Specs for 2010 1099s


Our 1099 software includes full support for 2010 1099 e-filing in accordance with IRS publication 1220 Specifications for Filing Forms 1098, 1099, 3921, 3922, 5498, 8935 and W-2G Electronically. To download a free demo, please visit the 1099 software download page. 

General Changes for Tax Year 2010 1099 E-Filing

(1) Under the Combined Federal/State Filing Program, the Form 6847 was obsoleted. IRS no longer requires this Form as part of the Combined Federal/State Filing Program. For approval to participate in the Combined Federal/State Filing Program test filing is still required.

(2) Change in contact name from IRS/ECC-MTB to IRS/IRB (Information Returns Branch), Information Reporting Program to Information Returns Branch and added Mail Stop 4300 to mailing address.

Programming Changes for Tax Year 2010 1099 E-Filing

(1) For all Forms, Payment Year, Field Positions 2–5, for the Transmitter “T” Record, Payer “A” Record and Payee “B” Record must be incremented to update the four-digit reporting year (2009 to 2010), unless reporting prior year data.

(2) Payer “A” Record moved the Combined Federal/State Indicator from field position 26 to field position 6.

(3) Payer “A” Record, expanded Type of Return field from a one position to a two position field. Previously the field position was 27, now it is field positions 26–27.

(4) New Form 1097-BTC, Bond Tax Credit.

In the Payer “A” Record added:
—field positions 26–27 Type of Return added new code BT,
—field positions 28–41 Amount Codes add 3 for ‘Stated Principal’, 4 for ‘March 15, 2010 Allowance Date Credit’, 5 for ‘June 15, 2010 Allowance Date Credit’, 6 for ‘September 15, 2010 Allowance Date Credit’, and 7 for ‘December 15, 2010 Allowance Date Credit’.

In the Payee “B” Record added:
—field position 547 for Issuer indicator, 1 indicates ‘Issuer of Bond or Its Agent Filing Initial 2010 Form 1097-BTC for this bond’, 2 indicates ‘An Entity that received a 2010 Form 1097-BTC for this Bond’
—field positions 548–555 for Bond Issue Date, format YYYYMMDD
—field positions 556–563 for Maturity Date, format YYYYMMDD
—field positions 564–576 for CUSIP Number
—field positions 608–610 Bond Code:

101 Qualified Forestry Conservation Bonds
102 New Clean Renewable Energy Bonds
103 Qualified Energy Conservation Bonds
104 Qualified Zone Academy Bonds
105 Qualified School Construction Bonds
106 Clean Renewable Energy Bonds
107 Midwestern Tax Credit Bonds
108 Other
109 Build America Bonds
—field positions 611–619 for Bond Issuer’s Identification Number
—field positions 620–659 for Bond Issuer’s Name

(5) Form 1098-C, Payee “B” Record changed the Goods and Services from field positions 731–748 to field positions 731–746 reducing the field length from 18 to 16 positions.

(6) Forms 1099 INT, Payee “B” Record new field added. Field title CUSIP Number in field positions 587–599.

(7) Form 1099 R, Payee “B” Record field positions 545–546, added new distribution codeWfor ‘Charges or payments for purchasing qualified long-term care insurance contracts under combined arrangements’, changed code 6 description to ‘Section 1035 exchange (a tax-free exchange of life insurance, annuity, qualified long-term care insurance, or endowment contracts)’, and changed code E description to ‘Distributions under Employee Plans Compliance Resolution Systems (EPCRS)’. Distribution code W can be used with code 6.

(8) Form 3922, Payer “A” Record, field positions 28–41, add Amount Code 8, Exercise Price per Share Determined as if the Option was Exercised on the Date Option Granted.

(9) Form 5498, Payer “A” Record, field positions 28–41 Amount Codes, deleted Amount Code E, Other Contributions and deleted the corresponding Bankruptcy Code in field positions 560–561 of the Payee “B” Record.

Check out our 1099 electronic filing software and see how easy it’s to e-file 1099’s.

Alabama Updates Payroll Withholding Tables Booklet


Our Payroll Software helps businesses and accountants do Alabama Payroll including calculating the state withholding and preparing payroll forms such as 941, 940, W2 and W-3. To learn more about our payroll system, please visit www.realtaxtools.com .
The state of Alabama recently updated the “Withholding Tax Tables and Instructions for Employers and Withholding Agents” booklet. There have been no changes to the payroll withholding tables themselves. This new booklet is a quick-reference source providing answers to the most commonly asked Alabama withholding questions.

This booklet contains tax tables and general instructions for computing, withholding, and remitting Alabama withholding tax. Because many monthly, quarterly and annual withholding tax returns are now being filed electronically, coupons are no longer automatically mailed to all withholding agents and employers. Coupons are no longer produced for those required to file electronically or for those who have voluntarily elected to file electronically. Employers who register for a withholding tax account number using our on-line application have an option to receive coupons. Those electing to file electronically will be sent instructions. Accountants and tax filing services may register as bulk filers through the Department’s Web site.

Employers or other withholding agents can register with the Department by completing a withholding tax application. The application (Combined Registration/ Application) can be completed and submitted on-line. The on-line withholding tax application can also be downloaded, completed and mailed to the address provided on the application. Our IL DOR address is www.revenue.alabama.gov .

If you are looking for affordable and super easy payroll tax software, please visit our payroll software page to download your free demo today.

Minnesota Payroll: Reciprocity Employee Withholding


Payroll Mate payroll software helps small businesses throughout the nation do payroll easily and at a very reasonable cost. Please visit our small business payroll software page for more details.

The state of Minnesota has recently released  Payroll Withholding Tax Fact Sheet 20 which covers  Reciprocity Employee Withholding for employers who employ Michigan or North Dakota residents to work in Minnesota or Minnesota residents to work in Michigan or North Dakota.

 If you are a Minnesota company and you are required to withhold federal income tax from an employee’s wages who is a resident of a reciprocity state, in most cases you are also required to withhold Minnesota income tax. However, if your employee does not want you to withhold Minnesota tax from his or her payroll check, they must give you a completed Form MWR, Reciprocity Exemption/Affidavit of Residency, by February 28 of each year, or within 30 days after he or she begins working or changes their permanent residence. To continue to be exempt from Minnesota withholding tax, the employee must submit a new Form MWR to you each year.  You have until March 31 of each year or within 30 days after the employee gives you a Form MWR to submit copies to the department. For details, see Form MWR instructions.

 If you are a company located in a reciprocity state, you are not required to withhold Minnesota tax from an employee who is a Minnesota resident. However, you may choose to do so as a courtesy to your employee. If you choose not to withhold Minnesota tax, your employee may be required to make regular estimated tax payments to us. Your employee is required to pay estimated tax if he or she expects to owe $500 or more on their Minnesota income tax return.

Test drive of our Payroll Software and see how easy it’s to do payroll yourself.

Latest State Withholding Tables | Payroll Withholding Calculator


Our Payroll Software ships with the latest withholding tax tables with support for all 50 states and DC. You can download a free demo by visiting the payroll software download page.

These are the latest withholding tables as of August 9, 2010 . 

Table Revision Date
Alabama Withholding Tables July 2010
Alaska No income tax
Arizona Withholding Tables November 2009
Arkansas Withholding Tables December 28 2009
California Withholding Tables January 2010
Colorado Withholding Tables May 2009
Connecticut Tables December 2008
Delaware Withholding Tables January 2000
D.C Withholding Tables January 2010
Florida No income tax withholding
Georgia Withholding Tables January, 2010
Hawaii Withholding Tables January 2007
Idaho Withholding Tables November 2008
Illinois Withholding Tables December 2007
Indiana Withholding Tables December 1 2009
Iowa Withholding Tables April 2006
Kansas Withholding Tables December 2009
Kentucky Withholding Tables December 2009
Louisiana Withholding Tables January 2003
Maine Withholding Tables November 2009
Maryland Withholding Tables December 2009
Massachusetts January 2008
Michigan Withholding Tables December 2009
Minnesota Withholding Tables January 2010
Mississippi Withholding Tables    July 2010
Missouri Withholding Tables December 2009
Montana Withholding Tables January 2005
Nebraska Withholding Tables January 2008
Nevada No income tax
New Hampshire No income tax
New Jersey Tax Tables December 2009
New Mexico Tables July 2010
New York Withholding Tables January 2010
N.C Withholding Tables October 2009
N.D Withholding Tables December 2009
Ohio Withholding Tables December 2009
Oklahoma Withholding Tables December 2009
Oregon Withholding Tables January 2007
Pennsylvania Flat rate of 3.07%
S.C Withholding Tables October 2008
South Dakota No state income tax withholding
Tennessee No income tax withholding
Texas No income tax withholding
Utah Withholding Tables November 2009
Vermont Withholding Tables December 2009
Virginia Withholding Tables December 2009
W Virginia Withholding Tables Jan 2007
Washington No income tax withholding
Wisconsin Withholding Tables July 2009

Claiming The Hire Act Payroll Exemption | Form W-11 | 2010 Form 941

Use Form W-11 to confirm that an employee is a qualified employee under the HIRE Act. Claim your payroll tax exemption with our payroll program. Download a free trial of Payroll Mate our small business 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 income tax returns.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. 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.

You can find more information about Payroll Mate an easy payroll solution by going to www.realtaxtools.com  or by downloading a free demo of our payroll/ Form 941 software .