Microsoft Dynamics GP

U.S. 2011 Year-End Update

Microsoft Dynamics GP 2010 and Release 10.0
Copyright Copyright © 2011 Microsoft Corporation. All rights reserved.

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Publication date November 2011

 C O N T E N T S

Contents
Introduction ................................................................................................................................................. 1
What’s in this manual...................................................................................................................................1
Symbols and conventions ............................................................................................................................2
Year-end resources ........................................................................................................................................2
Send us your documentation comments ...................................................................................................3

Chapter 1: Changes in the year-end update................................................................. 5

Payroll form layout and application changes...........................................................................................5
W-2 electronic filing changes.......................................................................................................................5
Payables form and application changes ....................................................................................................6

Chapter 2: Payroll year-end checklists .............................................................................. 7

Printing 2011 statements before processing 2012 pay runs.....................................................................7
Processing 2012 pay runs before printing 2011 statements.....................................................................8

Chapter 3: Preparation and FAQs .......................................................................................... 9

Supported releases........................................................................................................................................9
Obtaining the year-end update...................................................................................................................9
Obtaining a User Identification Number to submit EFW2 files electronically ....................................9
Non-supported electronic filing .................................................................................................................9
Frequently asked questions .......................................................................................................................10

Chapter 4: Payroll year-end procedures........................................................................ 15

Payroll year-end closing.............................................................................................................................15
Installing the year-end update ..................................................................................................................17
Creating the Year-End Wage file ...............................................................................................................21
Editing W-2 records ....................................................................................................................................21
Editing 1099-R statement information.....................................................................................................23
Archiving Human Resources information for inactive employees .....................................................24
Setting up fiscal periods.............................................................................................................................24
Setting up attendance .................................................................................................................................26
Deleting information for inactive employees .........................................................................................28

Chapter 5: Submitting W-2 reports electronically .............................................. 31

Creating EFW2 files ....................................................................................................................................31
Submitting EFW2 files................................................................................................................................33

Chapter 6: Report procedures................................................................................................ 35

Printing the Year-End Wage Report .........................................................................................................35
Printing W-2 forms and reports ................................................................................................................36
Printing 1099-R forms and reports ...........................................................................................................38

Index ................................................................................................................................................................... 41

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Introduction
This document contains instructions for updating the U.S. Payroll module for
Microsoft Dynamics® GP 2010 and Release 10.0 so that your system is compliant
with 2011 filing requirements.

Also included in this document are instructions for completing payroll year-end
procedures.

These instructions assume that you are already familiar with U.S. Payroll for
Microsoft Dynamics GP.

You can find information about year-end payroll procedures in the “Payroll
Company Routines” and “Government Form and Report Routines” chapters in the
U.S. Payroll manual, or the sections of help with the same names.

Note, however, that the instructions in this document expand on the instructions in
your Payroll documentation, and in some cases supersede them.

This introduction is divided into the following sections:

• What’s in this manual

• Symbols and conventions
• Year-end resources
• Send us your documentation comments

What’s in this manual

This manual is designed to give you an understanding of new 2011 tax year filing
requirements and to provide instructions for installing the updates necessary to
make Microsoft Dynamics GP compliant for 2011 filing. Additionally, you will find
instructions for completing year-end payroll procedures using your Payroll system.

To make best use of the year-end update, you should be familiar with systemwide
features described in the System User’s Guide, the System Setup Guide, and the
System Administrator’s Guide.

To view information about the release of Microsoft Dynamics GP that you’re using
and which modules or features you are registered to use, go to the Help menu.
Choose Help >> About Microsoft Dynamics GP.

The manual is divided into the following chapters:

• Chapter 1, “Changes in the year-end update,” contains an description of

application changes in the year-end update.

• Chapter 2, “Payroll year-end checklists,” contains checklists that you can use for
year-end payroll tasks.

• Chapter 3, “Preparation and FAQs,” contains information to help you prepare

for the year-end update, as well as answers to frequently asked questions.

• Chapter 4, “Payroll year-end procedures,” explains each payroll year-end

process, such as installing the year-end update, creating the Year-End Wage file,
editing forms and statements, and clearing inactive employee data.

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• Chapter 5, “Submitting W-2 reports electronically,” explains how to prepare and

submit federal W-2 files to the Social Security Administration.

• Chapter 6, “Report procedures,” provides descriptions of each year-end report

and procedures for printing them.

Symbols and conventions

For definitions of unfamiliar terms, see your Payroll glossary in the manual or refer
to the glossary in Help.

Symbol Description
The light bulb symbol indicates helpful tips, shortcuts and
suggestions.

The warning symbol indicates situations you should be

especially aware of when completing tasks.

This manual uses the following conventions to refer to sections, navigation, and
other information.

Convention Description
Creating a batch Italicized type indicates the name of a section or procedure.
File >> Print The (>>) symbol indicates a sequence of actions, such as
selecting items from a menu or toolbar, or pressing buttons in
a window. This example directs you to go to the File menu and
choose Print.
TAB or ENTER All capital letters indicate a key or a key sequence.

Year-end resources
If you have questions about Payroll year-end closing procedures and your
Microsoft® Partner isn’t available, there are several resources, in addition to this
document, to assist in answering your year-end questions.

Year-end information on CustomerSource

(https://mbs.microsoft.com/customersource/support/downloads/taxupdates/)

Look here to find year-end updates, instructions, and tax updates. Instructions for
downloading and installing the updates are also provided here.

Knowledge Base
(https://mbs.microsoft.com/knowledgebase/search.aspx)

Provides you with instant access to the same database our support engineers use.
You can find answers to common questions, along with technical tips and
performance recommendations.

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eSupport
(https://mbs.microsoft.com/support/newstart.aspx)

For support requests that can be handled with e-mail. On average, the response
time is nearly twice as fast as telephone support. That’s a big benefit during the
critical year-end season.

Community
(https://mbs.microsoft.com/customersource/communities/)

Start a year-end discussion with other members of the Microsoft customer

community. This database provides you with the opportunity to exchange
information with other customers, which is perfect for providing tips and answers
to year-end questions.

Microsoft Dynamics GP support team

We have specialized support teams focused on providing service and support to our
Human Resources/Payroll customers. If you have Human Resources/Payroll
questions, dial toll free 888-GPS-SUPP (888-477-7877). Enter your 10-digit
authorization code.

Send us your documentation comments

We welcome comments regarding the usefulness of the documentation. If you have
specific suggestions or find any errors in this manual, send your comments by email
to the following address: [email protected].

Note: By offering any suggestions to Microsoft, you give Microsoft full permission to use
them freely.

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Chapter 1: Changes in the year-end update

The U.S. 2011 Year-End Update contains software changes to allow you to comply
with 2011 filing requirements as well as the most recent fixes for Microsoft
Dynamics GP. The following topics are included:

• Payroll form layout and application changes

• W-2 electronic filing changes
• Payables form and application changes

Payroll form layout and application changes

A new Kind of Employer field has been added to the Payroll Tax Identification
Setup window (Tools >> Setup >> Payroll >> Tax ID). This field is used to select the
option that will be printed on the W-3 and included in the EFW2 file. The option in
this window will appear as a default selection in the Print W-2 Forms and Electronic
Filing Employer Information window. The options are:

• None Apply (default)

• 501c non-govt
• State/local non-501c
• State/local 501c
• Federal govt

New codes have been added to Box 12 on the W-2 form:

• Code DD is to be used to report the cost of employer-sponsored health

coverage.
• Code EE is to be used to report Designated Roth Contributions under a
governmental section 457(b) plan.

Box 9 (Advance EIC payments) has been removed because this field is no longer
used. If you have an amount in that field other than zero, you will see a warning on
the W-2 Validation Report.

The W-3 form includes some layout changes. Box 9 (Advance EIC payment) has
been removed because this field is no longer used. Several other boxes are adjusted
in the layout to accommodate the new section in Box b, Kind of Employer section,
as described previously.

The fields that were added in the US 2010 Year-End Update for the Hiring Incentives to
Restore Employment (HIRE) Act remain on forms. However, any amounts are
automatically changed to zero for year-end 2011 only.

On the 1099-R form, boxes 10-15 have been renumbered 12-17. The data in the boxes
follows to the renumbered box.

W-2 electronic filing changes

Changes in the 2011 EFW2 file generated by Microsoft Dynamics GP include the
following:

• A new field has been added to the RE Employer Record for Kind of Employer
for position 174. This is a required field and is not valid for employers in Puerto
Rico.

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• A new field has been added to the RW Employee Record for Cost of Employer-
Sponsored Health Coverage for positions 463-473. This does not apply to
employees in Puerto Rico or Northern Mariana Islands.

• A new field has been added to the RT Total Record for Cost of Employer -
Sponsored Heath Coverage for positions 295-309. This does not apply to
employees in Puerto Rico or Northern Mariana Islands.

• A new field has been added to the RO Employee Record for Designated Roth
Contributions Under a Governmental Section 457 (b) Plan for positions 111-121.
This does not apply to employees in Puerto Rico or Northern Mariana Islands.

• A new field has been added to the RU Total Record for Designated Roth
Contributions Under a Governmental Section 457 (b) Plan for positions 145-159.
This does not apply to employees in Puerto Rico or Northern Mariana Islands.

• Country code changes are as follows:

• Add Curaco (UC)

• Add Sint Maartin (NN)
• Rename East Timor (TT) to Timore-Lest (TT)
• Remove Netherlands Antilles (NT)

Payables form and application changes

On the 1099-DIV form, boxes 2c, 2d, 3, 4, 5, 6, 8 and 9 have been moved so that the
information is printed in the appropriate box, which fixes an issue from previous
releases. If you use a modified report to correct this issue, you can continue to use
the modified report, or you can now use the updated report. The benefit to using
the updated report is that any future changes will be included in future releases,
and you won’t need to change the modified report.

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Chapter 2: Payroll year-end checklists

This chapter contains checklists that you can use for year-end. Use the checklist that
most suits the way your company handles Payroll year-end activities. The following
checklists are provided:

• Printing 2011 statements before processing 2012 pay runs

• Processing 2012 pay runs before printing 2011 statements

Printing 2011 statements before processing 2012 pay

runs
Use this checklist to install the year-end maintenance and update, to close the 2011
payroll year, to update your Payroll system with the 2012 Payroll tax changes, and
to print 2011 wage statements before performing 2012 pay runs.

Detailed instructions for completing each step are found in the chapters and
sections indicated.

Step Description
1 Verify that you have installed the latest 2011 Payroll tax updates.
2 Complete all 2011 pay runs.
3 Complete all payroll month-end, period-end, or quarter-end procedures.
Note: You can install the year-end update (step 5) before this step, as long as you create a backup before installing.
4 Make a backup of your 2011 company database(s). Label the backup “Pre Year-End Wage file”.
5 Install the U.S. 2011 Year-End Update. See Installing the year-end update on page 17. Note: Do not restart Microsoft Dynamics
GP on any workstation until the update has been installed on all workstations that run the application.
6 Create the Year-End Wage file. See Creating the Year-End Wage file on page 21.
Note: 2012 Payroll tax updates can be installed any time after the Year-End Wage file has been created.
7 Make a backup of your 2011 company database(s). Label the backup “Post Year-End Wage file”.
8 Verify W-2 and 1099-R statement information.
Note: If you make changes to the statement information, we recommend that you make another backup.
9 Print the W-2 Validation Report, W-2 statements, and W-3 Transmittal form. See Chapter 6, “Report procedures.”
10 Print the 1099-R Validation Report, 1099-R forms, and 1096 Transmittal Form. See Chapter 6, “Report procedures.”
11 Prepare and submit W-2 information in the federal EFW2 format, if required. See Chapter 5, “Submitting W-2 reports
electronically.”
12 Archive Human Resources information for inactive employees (optional).
13 Set up fiscal periods for 2012.
14 Delete Human Resources information for inactive employees (optional).
15 Close the fiscal periods for the Payroll series for the 2011 year (optional).
16 Install the 2012 Payroll tax update.

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Processing 2012 pay runs before printing 2011

statements
Use this checklist if you need to process 2012 pay runs before printing 2011 wage
statements.

Detailed instructions for completing each step are found in the chapters and
sections indicated.

Step Description
1 Verify that you have installed the latest 2011 Payroll tax updates.
2 Complete all 2011 pay runs.
3 Complete all payroll month-end, period-end, or quarter-end procedures.
Note: You can install the year-end update (step 5) before this step, as long as you create a backup before installing.
4 Make a backup of your 2011 company database(s). Label the backup “Pre Year-End Wage file”.
5 Install the U.S. 2011 Year-End Update. See Installing the year-end update on page 17. Note: Do not restart Microsoft Dynamics
GP on any workstation until the update has been installed on all workstations that run Microsoft Dynamics GP.
6 Create the Year-End Wage file. See Creating the Year-End Wage file on page 21.
Note: 2012 Payroll tax updates can be installed any time after the Year-End Wage file has been created.
7 Make a backup of your 2011 company database(s). Label the backup “Post Year-End Wage file”.
8 Verify W-2 and 1099-R statement information.
Note: If you make changes to the information, we recommend that you make another backup.
9 Archive Human Resources information for inactive employees (optional).
10 Set up fiscal periods for 2012.
11 Clear Human Resources information for inactive employees (optional).
12 Close the fiscal periods for the Payroll series of the 2011 year (optional).
13 Install the 2012 Payroll tax update.
14 Process 2012 pay runs.
15 Print the W-2 Validation Report, W-2 statements, and W-3 Transmittal forms. See Chapter 6, “Report procedures.”
16 Print the 1099-R Validation Report, 1099-R forms, and 1096 Transmittal Form. See Chapter 6, “Report procedures.”
17 Prepare and submit W-2 information in the federal EFW2 format, if required. See Chapter 5, “Submitting W-2 reports
electronically.”

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Chapter 3: Preparation and FAQs

Use the instructions in this chapter to prepare for the U.S. 2011 Year-End Update.
Information is divided into the following sections:

• Supported releases
• Obtaining the year-end update
• Obtaining a User Identification Number to submit EFW2 files electronically
• Non-supported electronic filing
• Frequently asked questions

Supported releases
The U.S. 2011 Year-End Update supports Microsoft Dynamics GP 2010 and Release
10.0.

To identify the release you’re using, start Microsoft Dynamics GP. Choose Help >>
About Microsoft Dynamics GP.

If you’re not using one of the supported releases, upgrade to a supported version
before installing this update.

For more information about product discontinuation dates, refer to the discontinuation chart
on CustomerSource (https://mbs.microsoft.com/customersource/support) >> Support
Information. Select “Effectively predict support availability with the Microsoft Support
Lifecycle Policy.”

Obtaining the year-end update

Download update files and documentation from CustomerSource (https://
mbs.microsoft.com/customersource/support/downloads/taxupdates), or obtain
them from your Microsoft Partner.

Obtaining a User Identification Number to submit

EFW2 files electronically
If you plan to submit W-2 statements electronically using the EFW2 format, you
must first register for a User Identification Number (User ID) with the Social
Security Administration.

Use one of the following options to obtain a User Identification Number:

• Internet: www.socialsecurity.gov/bso/bsowelcome.htm

• Telephone: 1-800-772-6270 Monday through Friday, 7 a.m. to 7 p.m. (EST)

Non-supported electronic filing

Microsoft Dynamics GP currently supports electronic filing of W-2 information in
the federal EFW2 format. Some states also accept this format.

Microsoft Dynamics GP does not support electronic filing of 1099-R forms, State
Unemployment Tax (SUTA) forms, or state W-2 forms in formats other than EFW2.
You will need to use separate software or services for filing these items. Contact a
Microsoft Developer that offers compatible electronic filing products.

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This is the contact information for the Microsoft Developers:

Greenshades Software, Inc.

7020 AC Skinner Parkway
Suite 100
Jacksonville FL 32256
Telephone: (888) 255-3815
E-mail: [email protected]
Web site: www.greenshades.com

MasterTax, LLC
7150 East Camelback Road, Suite 160
Scottsdale, AZ 85251
Telephone: (480) 778-8723
E-mail: [email protected]
Web site: www.mastertax.net

Frequently asked questions

As you complete year-end tasks, refer to the answers in this section.

Q: What will happen if I’ve already closed the 2011 Payroll tax year
and don’t install the 2012 tax update right away?

A: Until you install the 2012 tax update containing FICA, federal, and state tax
changes, the tax calculations for your 2012 pay runs may be incorrect.

Q: If I use multiple companies with my accounting system, do I have

to install the year-end tax update for each company?

A: No. The update will be reflected in all companies. However, you do need to
install the update on each workstation using Microsoft Dynamics GP.

Q: I need to print my 2012 checks before I can print W-2s. What

should I do?

A: After you create the Year-End Wage file, close the year. Install the 2012 tax
update, and you can print checks. Follow the checklist for Processing 2012 pay runs
before printing 2011 statements on page 8.

Q: How do I print multiple W-2 statements for each employee?

A: There are two ways:

Using Laser form “sets” To print all the required forms for each employee
at a time (you’re using laser form “sets”), simply enter the number of copies
you need to print in the “number of copies” field in the Print dialog box that
appears after you choose Print in the Print W-2 Forms window.

For example, to print four copies of the W-2 statement for each employee, enter
“4” in the Print dialog box. Information for two employees will be printed per
page: Copy A for two employees, Copy B for two employees, Copy C for two
employees, Copy D for two employees, etc. until the required number of copies
has been printed for all employees.

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Using Laser form “sheets” To print all forms for all employees, repeat the
Printing W-2 Statements procedure as many times as necessary to print the
required number of copies. For example, to print copies of the W-2 statements,
put the Copy A sheets into the printer and follow the procedure. Copy A W-2
statements will be printed for each employee. Then, put the Copy B sheets into
the printer and repeat the procedure, and so on, until all required forms are
printed for all employees.

Q: I can’t make W-2 forms align correctly. What can I do?

A: Try the following method to correct alignment issues:

1. Print the W-2s to the screen.

2. Choose the printer icon button on the top left.

3. A print dialog box with horizontal and vertical alignments will appear on the
right. Adjust according to the situations below:

Problem Adjustment
Form prints too high Enter a positive vertical adjustment (.25 is one line).
Form prints too low Enter a negative vertical adjustment (-.25 is one line).
Form prints too far right Enter a negative horizontal adjustment.
Form prints too far left Enter a positive horizontal adjustment.

Q: I have closed the year and I want to print the 941 for the prior
year, but it is blank. Why?

A: The 941 report is date sensitive, so you need to be sure the Microsoft Dynamics
GP user date and the year you’re printing the 941 for are the same.

Q: How do I verify federal withholding taxes?

A: If an employee’s federal withholding taxes seem incorrect or you want to

verify the amounts, follow these steps to help pinpoint the error source.

1. Verify your employee’s records in the Payroll Employee Tax Maintenance

window (Cards >> Payroll >> Tax). Check to see if any additional amounts have
been entered in the Additional Withholding and Estimated Withholding fields.

2. Open the Deduction Setup window. (Microsoft Dynamics GP menu >> Tools >>
Setup >> Payroll >> Deduction. Verify that all deductions are marked as TSA
are marked correctly.

3. Be sure that the pay frequency of the employee’s pay codes matches the pay
period of your company. For example, if you pay your employees semimonthly,
the pay frequency for the employee’s pay code, deduction, and benefit should
also be semimonthly.

For additional information, search the Microsoft Dynamics Knowledge Base (https://
mbs.microsoft.com/knowledgebase/search.aspx) and view article number 855655.

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Q: What will happen if I have deductions and/or benefits set to print

in the same box on the W-2 statement with the same label?

A: The amounts will be combined and print as one.

Q: How do I print W-2 statements for Medicare Qualified

Government employees?

A: In the Print W-2 Forms window (Microsoft Dynamics GP menu >> Tools >>
Routines >> Payroll >> Print W-2s), select the Medicare Qualified Government
Employee option in the Employee Type box. The W-2 statements for Medicare
Qualified Government Employees are printed separately.

Q: What is the source of the Employer Identification Number that

appears as a default in the Print W-2 Forms window?

A: The number is the federal or state ID entered in the Unemployment Tax Setup
window (Microsoft Dynamics GP menu >> Setup >> Payroll >>Unemployment
Tax) in the Unemployment Tax ID field.

Q: In both the Edit W-2 Information and the Print W-2 Forms
windows, there is a list used to select the year. Is there a limit to the
number of years available? Also, is each year added to the year-end
wage file, or does each year have separate year-end wage files
created during the year-end closing process?

A: During the Payroll year-end closing process, the Year-End Wage File is created.
Multiple years of history can be saved. If you choose the same year twice when
performing the process, the previous file will be replaced by the new file. As long as
the correct year is entered each time, the new year’s information will be added to
the file. This information can be cleared using the Remove Payroll Year-End
Information window.

Q: If I add information in the Edit W-2 Special Information window

(Special button in the Edit W-2 Information window) without entering
information in the Edit W-2 Information window, where will that
information appear?

A: It will print this information on the additional W-2.

Q: The correct Last Year-End Update date doesn’t appear in the

Payroll Setup window, even though I installed the 2011 year-end
update and see the changes included in the update. Is there
something I need to do?

A: The Last Year-End Update date is read from the LastYearEndUpdate= line in
the Dex.ini file. When you install a year-end update on a particular computer, the
Dex.ini file on that computer is updated. However, in some Windows Terminal
Server deployments, there is only a single installation of Microsoft Dynamics GP,
which many users access. Each user typically has a Dex.ini file in their home
Windows folder. Installing the year-end update on the server doesn’t update each
user’s Dex.ini file. In these situations, you should manually update each user’s
Dex.ini file so that the appropriate line reads LastYearEndUpdate=11/17/2011.

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For more information about how the Year-End Update date is changed, search the Microsoft
Dynamics Knowledge Base (https://mbs.microsoft.com/knowledgebase/search.aspx) and
view article number 981312.

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Chapter 4: Payroll year-end procedures

Use the instructions in this chapter to start your Payroll year-end closing tasks. The
first section provides an overview of the tasks involved. The remaining sections
provide additional detail for specific steps.

Information is divided into the following sections:

• Payroll year-end closing

• Installing the year-end update
• Creating the Year-End Wage file
• Editing W-2 records
• Editing 1099-R statement information
• Archiving Human Resources information for inactive employees
• Setting up fiscal periods
• Setting up attendance
• Deleting information for inactive employees

Payroll year-end closing

Use this procedure to close the 2011 Payroll year. After closing the year, you need to
install the 2012 Payroll tax update before processing 2012 pay runs. There are two
year-end checklists you can use to close the year for payroll. The steps in this section
correspond most closely to Printing 2011 statements before processing 2012 pay runs on
page 7. For more information, see the checklists in Chapter 2, “Payroll year-end
checklists.”

To complete payroll year-end closing:

1. You already should have completed the tasks in Chapter 3, “Preparation and
FAQs.”

2. Complete all 2011 pay runs. The information created during the pay runs is
used for month-end or period-end, quarter-end, and any additional year-end
reports that you print. You can reprint period-end, quarter-end, or additional
reports and re-create the Year-End Wage file at any time.

It’s important that you complete all pay runs for 2011 before you install a 2012 Payroll
tax update. If you install a 2012 Payroll tax update before completing your pay runs,
taxes will be calculated at 2012 rates for the remainder of the 2011 pay runs.

3. Complete your company’s standard payroll month-end or period-end, and

quarter-end procedures (optional). These procedures might include printing
several month-end or period-end and quarter-end reports. You can reprint these
reports at any time.

4. Back up your 2011 Microsoft Dynamics GP data. Label the backup “2011 Pre
Year-End Wage file.” If you encounter a problem while creating the Year-End
Wage file, you can restore information from this backup. The Internal Revenue
Service requires you to keep these records for at least four years.

5. Install the U.S. 2011 Year-End Update on each client workstation that will use
Microsoft Dynamics GP. Before installing the update, ask all Microsoft
Dynamics GP users to exit the application until the update is complete on every
workstation. For more information, see Installing the year-end update on page 17.

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This step can be done at any time, even if you have not completed all of your 2011 pay
runs. This step must be done before you create the Year-End Wage file.

6. Create the Year-End Wage file. For information, see Creating the Year-End Wage
file on page 21.

2012 Payroll tax updates can be installed any time after the Year-End Wage file has been
created. However, if you create the Year-End Wage file, then install 2012 updates and
re-create the 2011 year-end file, your FICA limits may be incorrect.

7. Back up your 2011 Microsoft Dynamics GP. This backup must be separate from
the “2011 Pre Year-End Wage file” backup. Label the backup “2011 Post Year-
End Wage file.” You can use this backup if you encounter problems while
printing W-2 statements. The Internal Revenue Service requires you to keep
these records for at least four years.

8. Verify W-2 and 1099-R statement information. If you’re printing W-2 statements
before closing the year 2011 or after processing a 2012 pay run, we suggest that
you verify that the W-2 and 1099-R statement information is correct before you
close the payroll year. For information, see Printing the Year-End Wage Report on
page 35. You also might want to make changes to your W-2 records. For
information, see Editing W-2 records on page 21.

To verify 1099-R statement information, you can print 1099-R statements using
the Print 1099-R Forms window. If you make changes to your 1099-R records,
we recommend that you make another backup. For information, see Editing
1099-R statement information on page 23.

9. Print the W-2 Validation Report to verify that the information to be printed on
W-2 statements is correct. The report displays warnings if there are employee
record errors, except for employees with no wages, tips, or withholding
information entered on their W-2 forms. W-2 forms will not be printed for
employees with no earnings or withholding information. For instructions, see
Printing W-2 forms and reports on page 36.

For more information about validation report warnings, search the Microsoft Dynamics
Knowledge Base (https://mbs.microsoft.com/knowledgebase/search.aspx) and view
article number 872100.

Next, print the W-2 statements and W-3 Transmittal form. You should print a
W-2 statement for each employee who has worked for the company during the
year. For information, see Printing W-2 forms and reports on page 36.

10. Print the 1099-R Validation Report, 1099-R forms and 1096 Transmittal Form.
The 1096 statement is a report showing the distribution of pension payments for
use in preparing federal, state, and local tax returns. A 1099-R statement shows
an employee’s distribution from a retirement plan. For more information, see
Printing 1099-R forms and reports on page 38.

11. Create an EFW2 transmission file, if required. If your company has more than
250 employees, the Social Security Administration requires you to create and
submit federal W-2 wage reports electronically. For information, see Chapter 5,
“Submitting W-2 reports electronically.”

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12. Archive inactive employee Human Resources information (optional). If you’re

using Human Resources with Payroll and you want to save inactive employee
information while removing Payroll history records, you can archive the
information. Archiving information is beneficial if you need to provide
information for references, re-hiring, or other reporting purposes. For
information, see Archiving Human Resources information for inactive employees on
page 24.

13. Set up fiscal periods for 2012. Enter the number and length of each company’s
open fiscal periods for 2012 in the Fiscal Periods Setup window. For
information, see Setting up fiscal periods on page 24.

14. Delete inactive employee Human Resources information (optional). Deleting

Human Resources information saves hard disk space and ensures that unused
data is not available in lookup lists. For information, see Deleting information for
inactive employees on page 28.

To accrue time using the Human Resources attendance system, see Setting up
attendance on page 26.

15. Close the fiscal periods for the year 2011 (optional). Closing any Payroll periods
that are still open for the year 2011 keeps transactions from being accidentally
posted to the wrong period. For information, see Setting up fiscal periods on
page 24.

If you need to post Payroll transactions to a fiscal period you’ve already closed,
use the Fiscal Periods Setup window to reopen the period before posting the
transaction.

16. Install the 2012 Payroll tax update. For additional information and step-by-step
instructions to follow, download the latest 2012 U.S. Payroll Tax Update
documentation from CustomerSource (https://mbs.microsoft.com/
customersource/support/downloads/taxupdates). Choose the link for the
Microsoft Dynamics GP version you are using.

You also can print W-2 statements and 1099-R forms and create an EFW2 transmission
file after you’ve installed the 2012 Tax Update and performed pay runs for the year
2012. To view the checklist, see Processing 2012 pay runs before printing 2011
statements on page 8.

Installing the year-end update

Use these instructions to install the U.S. 2011 Year-End Update for Payroll.

If the files Reports.dic, Forms.dic, and Dynamics.vba are present in your

application, make backup copies before installing the U.S. 2011 Year-End Update.

You will need to install the year-end update on every workstation that runs
Microsoft Dynamics GP. Before you begin, ask all Microsoft Dynamics GP users to
exit the application until the update is complete.

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To install the year-end update:

1. Download the update from CustomerSource (https://mbs.microsoft.com/
customersource/support/downloads/taxupdates). The filenames are as
follows:

Language Release 10.0 Microsoft Dynamics GP 2010

English (U.S) MicrosoftDynamicsGP-KB2599501-v10-ENU.exe MicrosoftDynamicsGP-KB2599505-v11-ENU.msp
Spanish (Latin America) MicrosoftDynamicsGP-KB2599502-v10-ESLA.exe MicrosoftDynamicsGP-KB2599507-v11-ENU.msp

Save the appropriate file to a folder on the local disk drive of the server
workstation that runs Microsoft Dynamics GP.

The year-end update file also includes all prior Release 10.0 updates or Microsoft
Dynamics GP 2010 R2 Service Pack 2. Documents describing the service packs are
available from CustomerSource.

2. Double-click the file that you just downloaded. Progress windows appear as
space requirements are verified and files are installed.

3. A message may appear, asking if you want to restart now or later. Click Yes to
restart now, you will need to run the update file again after restarting.

4. After the installation is finished, manually restart your computer if a message

directed you to do so earlier.

5. Start Microsoft Dynamics GP Utilities.

Release 10.0 Start >> Programs >> Microsoft Dynamics >> GP 10.0 >> GP
Utilities
Microsoft Dynamics GP Start >> Programs >> Microsoft Dynamics >> GP 2010 >> GP
2010 Utilities

6. In the Welcome to Microsoft Dynamics GP Utilities window, verify your server

name, enter the system administrator user ID and password, and click OK.

7. In the second welcome window, click Next.

8. In the Upgrade Microsoft Dynamics GP window, click Next.

The Server Installation Progress window describes the process as it progresses.

If you’re using Microsoft Dynamics GP 2010, go to step 10.

9. Release 10 only: In the Update System Tables window, click Update to update
the tables.

10. In the Upgrade these companies window, click Next. All companies are selected
to be updated.

11. In the Confirmation window, click Finish.

Microsoft Dynamics GP Utilities updates your company databases. This process

may take several minutes to complete. The Server Installation Progress window
describes the process as it progresses.

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12. After the update process is finished and is successful, the Additional Tasks
window opens.

If the update process wasn’t successful, the Update Company Tables window
opens. To contact Microsoft Dynamics GP Technical Support, see Year-end
resources on page 2 for more information.

13. In the Additional Tasks window, choose Update modified forms and reports
and click Process. The Locate Launch File window appears.

14. Select the location of the launch file (Dynamics.set). In most cases you can
accept the default location. Click Next. The Update Modified Forms and
Reports window appears.

15. Mark the check box next to Microsoft Dynamics GP and any additional
components listed.

16. When you mark a component’s check box, a Product Details window may
appear, allowing you to select the location of the component’s original code
dictionary. You also can open the Product Details window by selecting a
component and clicking Details.

When you apply an update (.msp file), any dictionaries whose compatibility ID
has changed are backed up to a folder named “Version<Version
Number>Backup”. This folder is located in the same folder as Dynamics.exe.
The <Version Number> value is the version you were using before applying the
update.

If the original dictionary exists in the backup folder, Microsoft Dynamics GP

Utilities will automatically display its location in the Product Details window,
and you can click OK to accept the location. If the location is missing or
incorrect, click the file folder icon and browse to the appropriate location.

17. When you have finished selecting components, click Update. A Report
Upgrade Progress window displays the status of the update. When the process
finishes, click Close.

Log files containing detailed information about the update are saved in the
\Data folder. For each component, a report named “Update<Version_Name>
.log” is generated. An update summary named “Update<Version>.txt” is also
generated.

18. In the Modified Forms and Reports window, click Next. The Additional Tasks
window opens, where you can start Microsoft Dynamics GP, or exit Microsoft
Dynamics GP Utilities.

19. We recommend that you start Microsoft Dynamics GP and review all your
modified forms and reports, to verify whether they were updated correctly.

20. After installing the U.S. 2011 Year-End Update on a server for Microsoft
Dynamics GP, install the U.S. 2011 Year-End Update on all remaining client
computers.

You can set up Automated Client Update to update all client workstations. For
information about setting up the automatic updates, refer to your System
Administrator manual.

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To install the update on an operating system with User Account Control (UAC)
activated, a user must be running Microsoft Dynamics GP with administrative
privileges. (From the Start menu, select and right-click the Microsoft Dynamics GP
shortcut, and then select Run as Administrator.) For other ways to install the update on
Windows Vista clients with UAC activated, see Installing with UAC activated.

21. To confirm that the update is installed, open the Payroll Setup window.
(Microsoft Dynamics GP menu >> Tools >> Setup >> Payroll >> Payroll)

Check the Last Year-End Update date. It should be 11/17/2011.

If the date does not appear changed to 11/17/2011, search the Microsoft Dynamics
Knowledge Base (https://mbs.microsoft.com/knowledgebase/search.aspx) and view
article number 981312.

Installing with UAC activated

User Account Control (UAC) is an enhanced security feature in Windows® 7,
Windows Vista®, and Windows Server® 2008. UAC is activated by default. Before
performing actions that could affect your computer’s operation, such as installing
software updates, UAC asks for permission. To install the update on a client
computer when UAC is active, copy the .msp file to each client workstation, then
use one of the following methods:

• Start Microsoft Dynamics GP as a user that has administrative privileges on the

local computer. (To do this, right-click on the Microsoft Dynamics GP shortcut
and choose Run as administrator.) Double-click the .msp file to install it.

• Start the Command Prompt (located in the Accessories group) as a user that has
administrative privileges on the local computer. (To do this, right-click on the
Command Prompt shortcut and select Run as administrator.) Set the current
directory to the location where you copied the .msp file.

For Microsoft Dynamics GP 2010, enter the following command for U.S. English
installs:

Msiexec /p MicrosoftDynamicsGP-KB2435626-v11-ENU.msp /1*v C:\MSPErrorlog.txt

For Release 10.0, enter the following command for U.S. English installs:

Msiexec /p MicrosoftDynamicsGP-KB2435605-v10-ENU.exe /l*v C:\MSPErrorlog.txt

• If you want the user to install updates and service packs without having
administrative privileges on the local computer, you can change permissions for
the folder where Microsoft Dynamics GP is installed. Be aware that doing this
makes your computer less secure.

View properties for the folder, and display the Security tab. Grant Modify
permissions to an appropriate group, such as Users or Authenticated Users.
Once the folder permissions are changed, any user in the group can install the
.msp file by double-clicking it.

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Creating the Year-End Wage file

To ensure that information in the Year-End Wage file is correct, verify that you’ve set
up W-2 box and W-2 label settings within both the Employee Benefit Maintenance
window (Cards >> Payroll >> Benefit) and the Employee Deduction Maintenance
window (Cards >> Payroll >> Deduction) for each benefit and deduction.

Be sure that the W-2 options are marked correctly in the Employee Tax Maintenance
window (Cards >> Payroll >> Tax).

Verify your Employer State ID number in the Payroll Tax Identification Setup
window (Microsoft Dynamics GP menu >> Tools >> Setup >> Payroll >> Tax ID).

This is the number that will be printed on the W-2 statements. You can maintain an
Unemployment ID number and State Tax ID number in Microsoft Dynamics GP.

Be sure that you’ve installed the U.S. 2011 Year-End Update and updated your
Payroll information before creating the Year-End Wage file. Also, be sure that
you’ve made a full backup of all your company data and stored it in a safe place.

Use the Payroll Year-End Closing window to create a table of annual wage
information. The data from this table will be used to create W-2 statements and
1099-R statements.

To create the Year-End Wage file:

1. Open the Payroll Year-End Closing window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> Year-End
Closing)

2. Enter 2011 for the reporting year.

3. Choose Process to create the Year-End Wage file that will be used for printing
W-2 statements and 1099-R forms. You can store multiple years of year-end
wage information in Microsoft Dynamics GP. To clear previous year-end wage
information, use the Remove Payroll Year-End Information window (Microsoft
Dynamics GP menu >> Tools >> Utilities >> Payroll >> Remove Year-End
Information).

You can install 2012 tax tables any time after you’ve created the Year-End Wage
file. You also may need to process 2012 pay runs before printing 2011 wage
statements. For more information, see the checklist Processing 2012 pay runs
before printing 2011 statements on page 8.

Editing W-2 records

You can verify and update information for an employee’s W-2 statement in the Edit
W-2 Information window.

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However, when you make changes in this window, only the information in the Year-
End Wage file changes. The employee record doesn’t change, so it might be
necessary to make permanent changes to the record (if the employee’s address
changes, for example).

To edit W-2 records:

1. Open the Edit W-2 Information window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> Edit W-2s)

2. Select 2011 and select an employee. The employee’s Social Security number and
address are displayed in editable fields.

Social Security numbers that aren’t valid are listed in the W-2 Validation Report. For
more information, see Printing W-2 forms and reports on page 36.

If the employee has a foreign address, mark the Foreign Address option. Fields
specific to a foreign address will be displayed.

3. You can edit Special and Other box information by choosing Special or Other to
open the Edit Additional Special Information and Edit Additional Other
Information windows. If two deductions or benefits are defined to be printed in
the same W-2 box with the same label, the amounts will be combined.

4. Edit wage and withholding information. Additional W-2 statements will be

printed only for employees with multiple state tax records, multiple local tax
records, multiple special records, and multiple other records.

The Advanced EIC Payment field is no longer used on the W-2. If you have an amount
in that field other than zero, you will see a warning on the W-2 Validation Report.

5. Specify the type of employee for whom you’re editing W-2 information.
Information from the Employee Tax Maintenance window will appear as
default entries. Settings include:

Statutory Employee Mark this box if the employee is subject to FICA

withholding but not federal withholding.

Retirement Plan Mark this box if the employee is an active participant in a

retirement plan.

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6. Edit optional information, as needed. Choose State or Local to open the Edit
State Tax Information or the Edit Local Tax Information windows. Use these
windows to view state and local tax information that will be printed on the
main W-2 statement and supporting W-2 statements for the employee.

When you’ve finished editing information, choose OK to close the window and
return to the Edit W-2 Information window.

7. Choose Save to store the information and close the window.

Editing 1099-R statement information

Use the Edit 1099-R window to update a retired employee’s 1099-R information.
The 1099-R statement shows an employee’s distribution to a retirement plan.

When you make changes in the Edit 1099-R window, only the information in the
Year-End Wage file is changed, not the employee record itself. If the change is
permanent, such as an address change, you also will need to change the employee
record.

To edit 1099-R records:

1. Open the Edit 1099-R window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> Edit 1099-
Rs)

2. Select 2011 for the calendar year and select an employee. The employee’s Social
Security number and address are displayed in editable fields.

3. Edit miscellaneous information. If necessary, you can change the gross

distribution amount or the current-year total amount of the pension that the
employee received. If you know the amount of the distribution that is taxable,
enter that amount. Otherwise, leave the Taxable Amount Not Determined field
marked and the taxable amount at 0.

If the employee has an excess in deferrals or earnings, be sure to enter the

amount in excess in the appropriate amount field.

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4. Edit state and local tax information. If necessary, you can change the amounts of
the federal and state income tax withheld. You also can change the state and
payer’s state ID, the local tax withheld, and the name of the locality to which
the tax was paid. If an employee is receiving a W-2 statement as well as a 1099-R
statement, the withholding amounts will be pro-rated.

5. Choose Save to store the information and close the window.

Archiving Human Resources information for inactive

employees
Use the Employee Archive window to store inactive employee Human Resources
information, such as discipline records, reviews, and position history.

It’s important to archive inactive employee Human Resources information before deleting
inactive employees if you would like to keep this information in the system.

To archive Human Resources information for an inactive

employee:
1. Open the Employee Archive window.
(Microsoft Dynamics GP menu >> Tools >> Utilities >> Human Resources >>
Archive Employee)

2. Select the inactive employee whose information you want to archive.

3. Mark the information to archive.

4. Choose Save to apply the changes. For more information about archiving
employee records or accessing archived employee records, see the Human
Resources documentation included with Microsoft Dynamics GP.

Setting up fiscal periods

Setting up periods for the future fiscal year allows you to enter transactions into the
2012 fiscal year before closing the 2011 fiscal year. Enter the number and length of
each company’s open fiscal periods for 2012 in the Fiscal Periods Setup window.

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After clearing financial information, you also can use the Fiscal Periods Setup
window to:

• Close any Payroll periods that are still open for the year, which helps to keep
transactions from being posted to the wrong period or year.

• Reopen a fiscal period that you’ve already closed.

To set up fiscal periods:

1. Open the Fiscal Periods Setup window.
(Microsoft Dynamics GP menu >> Tools >> Setup >> Company >> Fiscal
Periods)

2. Enter the year. Also enter the first and last days of the fiscal year. The fiscal year
isn’t limited to a calendar year; it can be any length.

3. If you’re entering information for an historical year, mark the Historical Year
option.

4. Enter the number of fiscal periods in the fiscal year. For example, enter 4 for
quarterly periods, or 12 for monthly periods.

5. Choose Calculate to calculate first and last days for each period. The beginning
date of each period appears in the scrolling window.

You can reenter information and recalculate periods as many times as necessary.

6. Review the beginning dates of each period in the Date column. Make changes,
as needed.

7. In the Period Name column, review and rename the periods, as needed. For
example, enter Quarter 1 for Period 1.

8. Use the Series Closed columns to prevent posting to a series after a period has
been closed. This step is part of your period-end procedures.

9. Choose OK to save the information and close the window.

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Setting up attendance
Use the Attendance Setup window to specify if your company accrues time using
Payroll or the Human Resources attendance system. If you’re using Human
Resources, you also can set up vacation and sick time accrual methods in this
window.

To set up attendance:
1. Open the Attendance Setup window.
(Microsoft Dynamics GP menu >> Tools >> Setup >> Human Resources >>
Attendance >> Setup)

2. Specify how your company accrues benefit time.

Human Resources Mark Human Resources to use the Human Resources

attendance system.

Payroll Mark Payroll to use your accounting system to track attendance.

Proceed to step 7.

3. Mark the Print Available Time on Payroll Checks option in the Employee
Attendance Maintenance window (Cards >> Human Resources >> Employee -
Attendance >> Maintenance) to print available vacation and/or sick time on
payroll checks.

4. Mark the Allow entry of attendance type and reason in Payroll option to link
attendance type and reason codes to payroll transactions in the Payroll
Transaction Entry window. This option is available only when the accrue type is
Human Resources and U.S. Payroll is registered.

5. Enter the current payroll, or accrual, year and the last day that you accrued
attendance.

These fields are available with Human Resources when U.S. Payroll is not
registered. They also are available when the accrue type is Human Resources
and U.S. Payroll is registered.

6. Select whether seniority is based on Months or Days.

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7. You can choose to update the Vacation Calendar with attendance transactions.

Mark the Update Vacation Calendar option.

8. Reset benefit time available.

For instance, an employee has 12.75 vacation hours available and you want the
balance to be zero; you’d create an adjusting transaction for -12.75 hours for the
vacation time code.

If you don’t reset vacation and sick time available, the hours that were available
at the end of the year are carried over to the next year.

Accruing with Human Resources If you marked Human Resources as

your accrual type in step 2, you can reset benefit time available by creating an
Hours Available Adjustment in the Attendance Transaction Entry window
(Transactions >> Human Resources >> Transaction Entry).

For more information, see the Human Resources documentation included in

Microsoft Dynamics GP.

Accruing with Payroll If you marked Payroll as your accrual type in step 2,
(Microsoft Dynamics GP menu >> Tools >> Utilities >> Payroll >> Mass
Update) and reset benefit time available. In the Update list, choose Vacation
Time Available or Sick Time Available.

9. In the Attendance Setup window, enter the number of days that equal a week
and the number of hours that equal a day to define your organization’s work
schedule. For example, a standard 40 hour work week might be Number of
days in a week = 5 and Number of hours in a day = 8.

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10. Choose Options to open the Attendance Setup Options window.

11. Enter an attendance reason for absence—such as Jury Duty—and add it to the
Reason list by choosing the insert button. Then, enter an attendance type for the
reason—such as Miscellaneous—and add it to the Type list.

The reasons and types that you enter will be displayed in the Attendance
Transaction Entry window. If you marked the Allow entry of attendance type
and reason in Payroll option in the Attendance Setup window, then the reasons
and types will be displayed in the Payroll Transaction Entry window.

To remove an attendance reason or type from a list, select it and choose Remove.
Predefined reasons and types cannot be removed.

12. Choose OK to save your changes and return to the Attendance Setup window.
Choose OK again to save the settings in the Attendance Setup window.

Deleting information for inactive employees

The Remove Inactive Records window deletes inactive records in both Payroll and
in Human Resources. Deleting information for employees that you’ve inactivated
ensures that unused data is not being stored in the system and is not available in
lookup lists.

Don’t delete inactive records until after you’ve created the Year-End Wage file and have
printed all government statements and reports for the year. Once inactive employee records
are removed, you won’t be able to reprint statements and reports. You should also make sure
to archive all employee information that you want to keep.

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To delete information for inactive employees:

1. Open the Remove Inactive Records window.
(Microsoft Dynamics GP menu >> Tools >> Utilities >> Payroll >> Remove
Inactive Records)

2. Choose the type of information to delete. If you mark Remove Inactive

Employee Records and do not mark Remove History for Inactive Employees,
information for Payroll history reports will be retained.

3. Choose Process. When processing is complete, the Remove Inactive Employee

Records Utility Log will be printed.

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Chapter 5: Submitting W-2 reports electronically

If your company has more than 250 employees, the Social Security Administration
(SSA) requires you to create and submit federal W-2 wage reports electronically. If
your company has fewer than 250 employees, you can submit W-2 wage reports
either manually or electronically.

Microsoft Dynamics GP currently supports electronic filing of W-2 information in

the federal EFW2 format. Some states also accept this format for state W-2 electronic
filing. For states that require other electronic formats for W-2 filing, see Non-
supported electronic filing on page 9.

To create EFW2 files, the U.S. W-2 Magnetic Media feature must be registered for
Microsoft Dynamics GP. To verify this, choose Help >> About Microsoft Dynamics
GP and choose Options. Scroll through the list of registered modules to find U.S.
W-2 Magnetic Media. A checkmark indicates it is registered.

For more information about the electronics submission formats and free accuracy-
checking tools, visit the SSA website at www.socialsecurity.gov.

Information is divided into the following sections:

• Creating EFW2 files

• Submitting EFW2 files

Creating EFW2 files

Use the W-2 Electronic Filing window to create the EFW2 transmission file and to
select which companies to include in the file. In order to view this window, you
must be registered to use the U.S. W-2 Magnetic Media feature with Microsoft
Dynamics GP.

You must register with the SSA to submit the file. For information on how to
register and obtain a User Identification Number with the SSA, see Obtaining a User
Identification Number to submit EFW2 files electronically on page 9.

Before you begin, be sure you have completed these procedures:

• Completed all pay runs for the year.

• Created the Year-End Wage file. For more information, see Creating the Year-End
Wage file on page 21.

• Verified W-2 amounts on the Year-End Employee Wage report. For more
information, see Printing the Year-End Wage Report on page 35.

Be sure no one edits W-2 information while you’re working in the W-2 Electronic Filing
window.

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C H A P T E R 5 S U B M I T T I N G W -2 R E P O R T S E L E C T R O N I C A LL Y

To create the EFW2 file:

1. Open the W-2 Electronic Filing window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> W-2
Electronic Filing)

When you first open the window, a message prompts you to register with the
SSA to submit W-2 information electronically.

2. Enter the reporting year.

3. Mark the Include option for the first company to include in the EFW2 file.

4. If information for a selected company is incomplete, a yellow alert icon will

appear in the scrolling window heading. Click the icon to open the Electronic
Filing Employer Information window. Enter the missing employer information
and verify the Kind of Employer selection. Choose OK to close the window.

5. Repeat steps 3 and 4 for each company to include in the EFW2 file.

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6. Enter the destination and file name for the EFW2 file. The default file name is
W2Report, without an extension. If you add an extension, the SSA requires that
it be a valid extension, such as “.txt”.

7. Enter the User Identification Number assigned to you by the SSA when you
registered to submit EFW2 files electronically. You must enter your User
Identification Number before you can choose Create File. For information, see
Obtaining a User Identification Number to submit EFW2 files electronically on
page 9.

8. Choose Submitter to enter submitter information in the Electronic Filer

Submitter Information window. To ensure that your file is valid, you must enter
an e-mail address.

Address information should be no more than 22 characters per line. Excess characters
will be cut off in the file.

Choose OK to save the changes and return to the W-2 Electronic Filing window.

9. Choose Create File to create the EFW2 file now, or choose Save to store the
information for creating the file later. Choosing Save will also save changes in
the Electronic Filer Submitter Information window.

10. If a message is displayed stating that not all fields have been entered, choose
Submitter and verify that the information is complete.

The W-2 Electronic Filing Summary Report is printed after the EFW2 file is
created. This report is for informational purposes only.

We recommend using AccuWage to check all EFW2 files before sending. This is
a free tool available from the SSA website (www.socialsecurity.gov/employer/
accuwage).

Submitting EFW2 files

The following guidelines summarize the filing instructions provided by the SSA.
Read the SSA’s instructions carefully before submitting your EFW2 file.

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For information on Microsoft developers that provide electronic filing services for
state taxes, see Non-supported electronic filing on page 9.

BSO filing
You can use the SSA’s Business Services Online website to upload wage information
in EFW2 format to the SSA over the Internet. To use BSO, go to
www.socialsecurity.gov/bso/bsowelcome.htm. You’ll need to register for a User
Identification Number to use BSO services.

EDT filing
You can use the Electronic Data Transfer (EDT) system to file wage information
using the EFW2 format. The system connects SSA’s national computer with various
states, federal offices, and SSA sites. For details, refer to the Electronic Data Transfer
(EDT) Guide at www.socialsecurity.gov/employer/pub.htm.

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Chapter 6: Report procedures

You can generate either detailed reports or summary reports in your year-end
procedures, as needed. You also can customize your reports.

Information is divided into the following sections:

• Printing the Year-End Wage Report

• Printing W-2 forms and reports
• Printing 1099-R forms and reports

Printing the Year-End Wage Report

Print the Year-End Wage Report from the Year-End Wage Report window to verify
W-2 amounts before printing W-2 statements. This report contains the same
information that appears on the W-2 statement with headings for each field. It won’t
include Form 1099-R statement information. The Year-End Wage file must be
created before you can print the Year-End Employee Wage report.

To print the Year-End Wage Report:

1. Open the Year-End Wage Report window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> Year-End
Wage Report)

2. Enter 2011 as the year.

3. Select a sorting option for displaying information: Employee ID, Employee

Name, Department/Employee, or Social Security Number.

4. Mark All to include every employee in the report, or enter a starting and ending
employee ID to include a select group of employees.

5. Choose Print.

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Printing W-2 forms and reports

Use the Print W-2 Forms window to print the following forms and reports.

Report Description
W-2 Validation Report Shows W-2 information before printing W-2 statements, usually for
verification purposes. Information is validated according to the
Software Edit Criteria specified by the Social Security Administration.
W-2 Alignment Form Shows if the forms are aligned correctly in the printer before printing
statements. Print this before printing W-2 statements.
W-2 Statement Shows income earned and taxes deducted, and is distributed to your
employees for use in preparing federal, state, and local tax returns.
W-3 Transmittal Form Contains a summary of the W-2 statements after they are printed out.
The Social Security Administration requires you to submit this form
along with the W-2 statements.

You must print a W-2 statement for each employee who worked for you during the
year. In the Print W-2 Forms window you can specify which information should be
printed on the W-2 statement, and then print the statement. In addition, be sure that
the employee information for Box 13 of the W-2 form is accurately entered in the
Edit W-2 Information window before printing a validation report.

Print the W-2 Validation report before printing W-2 statements to verify that the
information to be printed on W-2 statements is correct. If the W-2 Validation Report
shows any errors that need to be corrected, use the Print W-2 Forms window or the
Edit W-2 Information window to make changes to the appropriate W-2 forms. For
more information, see Editing W-2 records on page 21.

If you’re submitting W-2 wage reports electronically, you can also use AccuWage
from www.socialsecurity.gov to verify if the information in your file is correct.

To print W-2 forms and reports:

1. Open the Print W-2 Forms window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> Print W-2s)

2. Enter 2011 as the reporting year.

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3. Select a printing option. Mark Normal Year-End to print W-2 statements for all
employees at the end of the year, including inactive employees and employees
who’ve already had W-2 statements printed.

4. Select an employment type.

• If you’re printing W-2 statements for employees who are required to pay
both FICA/Social Security and FICA/Medicare tax, mark Regular.

• If you’re printing W-2 statements for employees who are exempt from
FICA/Social Security tax but subject to FICA/Medicare tax, mark Medicare
Qualified Government Employee; also mark Medicare Qualified
Government Employee in the Employee Tax Maintenance window.

5. Mark All to print W-2 statements for every employee, or enter a starting and
ending employee ID to print statements for a select group of employees.

6. Select a sorting order for the W-2 statements: Employee ID, Employee Name,
Department/Employee Name, or Social Security Number.

7. Enter the company name, and select the company address ID. Also verify the
federal government employer identification number (EIN) and selection for
Kind of Employer.

8. Select a form type to print.

1 Wide-Continuous Select this option to print your form or report in a

continuous form, with one copy of the form or report for each page printed.

2 Wide-Continuous Select this option, also called Alternate Format, to print

your form or report in a continuous form, with two copies of the form or report
for each page printed.

1-Wide Single Feed Select this option to print your form or report on a
single sheet of paper. To print all forms for all employees using this format,
repeat the procedure for each form. For example, to print the A, B, and C copies
of the W-2 statements, first put the Copy A sheets in the printer and complete
this procedure; next put the Copy B sheets into the printer and complete this
procedure; finally, put the Copy C sheets into the printer and complete this
procedure.

4-Up Laser Forms Select this option to print your form or report in a sheet
of paper, but with four forms or reports for each page. The page contains Copy
B, Copy C, and two Copy 2 forms. Copy A and Copy D must be printed
separately. Copy A will be included in EFW2 files, if you are submitting federal
W-2 files electronically.

9. Select the form or report to print.

10. Verify that you’ve loaded the correct form in the printer.

11. Choose Print.

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C H A P T E R 6 R E P O R T P R O C E D U R E S

You can print as many copies of W-2 statements as needed. To print all the
required forms for each employee (using laser form sets), enter the number of
copies you need in the Print dialog box. Information for two employees will be
printed per page, on each form, Copy A through Copy D, until the required
number of copies have been printed. For more information, refer to the “How
do I print multiple W-2 statements for each employee?” question in Frequently
asked questions on page 10.

If you need to reprint W-2s for any reason, you can reprint them as a group or
individually. Use the Employee ID field to restrict the range of W-2 statements printed.

Printing 1099-R forms and reports

Use the Print 1099-R Forms window to print the following forms and reports:

Report Description
1099-R Validation Report Shows 1099-R information before printing 1099-R statements, usually
to ensure the information printed on the 1099-R statements is correct.
1099-R Alignment Form Shows if the forms are aligned correctly in the printer before printing
statements. Print this before printing 1099-R statements.
1099-R Statements Shows the distribution of pension payments for use in preparing
federal, state, and local tax returns. It also shows an employee’s
distribution from a retirement plan.
1096 Transmittal Form Contains a summary of the 1099-R statements.

You can print 1099-R statements and related reports any time.

If the 1099-R Validation Report shows errors, update the statements that have errors
in the Print 1099-R Forms window and the Edit 1099-R Information window. For
more information, see Editing 1099-R statement information on page 23.

To print 1099-R forms and reports:

1. Open the Print 1099-R Forms window.
(Microsoft Dynamics GP menu >> Tools >> Routines >> Payroll >> Print 1099-
Rs)

2. Enter 2011 for the calendar year. The default year is the current system year.

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3. Mark All to print 1099-R statements for every employee, or enter a starting and
ending employee ID to print statements for a select group of employees.

4. Select the sorting order for the 1099-R statements: Employee ID, Employee
Name, Department/Name, or Social Security Number.

5. Enter the company name, and select the appropriate company address ID. Also
verify the federal government employer identification number (EIN).

6. Select a form type to print: Continuous or Single Feed.

7. Select the form or report to print.

8. Verify that you’ve loaded the correct form in the printer.

9. Choose Print.

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 I N D E X

Index Employee Archive window

archiving Human Resources
reports (continued)
printing multiple copies of W-2s 36
information 24 quarter-end 15
Numerics displaying 24 W-2 15, 36
1099-R records employees, deleting inactive employee W-2 Electronic Filing Summary 31
changing gross distribution amount information 28 W-2 Validation report 15
23 Employer State ID Number, verifying 21 year-end wage report 35
controlling access to 23
editing 23 F S
verifying 15 fiscal periods sick time, resetting 26
closing and reopening 24 state electronic filing, solution developer
A reopening 15 support 9
Attendance Setup Options window setting up 15, 24 supported releases 9
displaying 28 Fiscal Periods Setup window symbols, used in manual 2
setting up attendance 26 displaying 25
Attendance Setup window, setting up setting up fiscal periods 24 T
attendance 26 frequently asked questions 10 tax updates, installing for Payroll 15
Attendance Transaction Entry window
accruing with attendance 26 H U
displaying 27 Human Resources information, archiving User Identification Number registration,
15, 24 for W-2 electronic submissions 9
C
changes for Payables Management, in I V
2011 year-end filing 6 icons, used in manual 2 vacation time, resetting 26
changes for Payroll, in 2011 year-end filing inactive employees versions, supported 9
5 archiving Human Resources
checklists information 15, 24 W
deleting Human Resources W-2
printing 2011 statements before
information 15 alignment correction 11
processing 2012 pay runs 7
deleting information 28 backing up data 15
processing 2012 pay runs before
choosing form types 36
printing 2011 statements 8
compliance update for 2011, Payroll 5 M creating EFW2 files 31
magnetic media, see electronic filing entering foreign addresses 21
D filing electronically 31
data backup N printing multiple copies 10, 36
minimum retention period 15 navigation, symbols used for 2 registering for an electronic
printing W-2 statements 15, 21 submission User Identification
verifying after changing statement
O Number 9
online tax resources 2 specifying additional printouts 21
information 15
submitting files electronically 33
documentation, symbols and conventions P verifying before year-end 15
2 pay runs, knowing when to complete 15 verifying the Employer State ID
payroll year-end closing 15
E Payroll Year-End Closing window
Number 21
Edit 1099-R Information window, editing verifying wage file information 21
creating a Year-End Wage file 21 W-2 Electronic Filing window
1099-R records 23
displaying 21 displaying 32
Edit W-2 Information window
Print 1099-R Forms window submitting W-2s electronically 31
displaying 22
displaying 38 W-2 records
editing W-2 records 21
printing 1099-R forms and reports 38 controlling access to 21
EFW2 files
Print W-2 Forms window editing 21
creating 31
displaying 36 Windows Server 2008, installing client
registering for a User Identification
printing W-2 forms and reports 36 updates 20
Number 9
product support, online tax resources 2 Windows Vista, installing client updates
submitting 33
20
Electronic Filer Submitter Information R
window, displaying 33 releases, supported 9
electronic filing Remove Inactive Records window,
Y
form W-2 reports 31 Year End Wage Report window
displaying 29 displaying 35
non-supported formats 9 reports
Electronic Filing Employer Information printing the year-end wage report 35
1099-R 15, 38 year-end installation
window, displaying 32 choosing W-2 form types 36 18
month-end 15
period-end 15

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I N D E X

year-end installation (continued)

installing on Windows Vista and
Windows Server 2008 clients 20
year-end update
installing 17
obtaining for manual updates 9
Year-End Wage file
creating 21
creating after data backup 15
creating before data backup 15
keeping multiple year wage
information 21
verifying entries 21

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