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P-cards Divorce from 1099-MISC
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By now, the benefits of using purchasing cards in accounts payable are widely known. However, starting this year, a new advantage to p-cards emerges – reduced 1099 reporting.
This issue discusses how making payments on a p-card means your organization has fewer 1099s to file next January. Also, this issue features a reminder of why, even without the reporting changes, p-cards are still great for AP.
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| Patrick Harbin – Editor
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P-card Reporting |
IRS Section 6050W took effect this month, meaning that payment processers – and not payers – are now responsible for reporting p-card payments to the IRS.
See 2011 Instructions for 1099 Make P-card Reporting Changes Final on TAPC.
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P-card Benefits |
While a reduced 1099-reporting burden for p-card payments is a solid reason to consider implementing a card program, organizations should not forget the inherent cost savings and efficiency gains. These include:
- Eliminating Rush Checks: Use p-cards in emergency situations where you would previously use a rush check
- Cutting Invoice Volume: 80 percent of invoices tend to be for $2,000 or less. P-cards can eliminateM many of these invoices
- Improving Days Payable Outstanding: With p-card settlement, you can pay invoices early while extending payment float by as many as 45 days
For a detailed look at how p-cards can transform your organization, be sure to attend the session "Powerful P-card Productivity Practices," part of The Accounts Payable Network's AP Leadership Conference. The session is presented by Larry Brang with Merck & Co.
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Just for Fun! |
Have you ever sent an email before it was ready? Perhaps a colleague upset you and you sent an angry reply that you later regret. These are just some avoidable email goofs many of us make every day. See 18 Common Work E-mail Mistakes.
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