You ran a Withholding Tax Return Run for a 1099 - File tax arrangement. When checking the generated output .txt file, you notice that in the 'T' record for the current tax year, the 'P' character is set in the 6th position - indicating it as previous tax year.
The file gets rejected by FIRE system in IRS - Internal Revenue Service.
SAP Business ByDesign.
Reproducing the Issue
- Go to Tax Management work center.
- Go to Withholding Tax Return view.
- Open the related tax return (tax Return Type Miscellaneous Income (1099 MISC) - File) executed in the current tax year (e.g. Jan-Dec/2019).
- Go to the Attachments tab and download the .TXT file.
You see that, in record 'T', the 'P' indicator is set in the 6th position: T2019P....
Since 2019 is the current tax year (to be reported beginning of 2020), the 'P' characters would not be expected.
The 'P' character is currently being set since the Send Date field of the tax return is after December, 21st.
This field can ben seen in the Tax Return under General tab. It is editable while the return is In Preparation. Since you would only report the 1099 taxes of e.g. 2019 (tax year) in 2020 (after the December, 21st check) the indicator is set for the current tax year.
Our developers are working on enhancing the system. Expected changes to be delivered in one of the subsequent ByDesign releases.
Until then, if you are reporting current tax year taxes and the indicator is being set, you may edit the output file manually and remove the previous year indicator.
WHT, Withholding Tax, Previous Year Indicator, Tax Management. , KBA , AP-DUE-WTD , Withholding Tax Declaration , How To