How to use Minimum Check Amounts
Appendix ››
How to use Minimum Check Amounts
The minimum check amount feature allows you to prevent Derek from writing revenue checks to owners for very small amounts. Minimum check amounts are stored in the Owner/Customer file.
NOTES ON FIELDS IN OWNER FILE:
SPECIFIED MINIMUM CHECK AMOUNT: The specified minimum check amount for each owner is used when Operating Statements are processed. For example, if you set the minimum check amount to $10, and an owners revenue check was determined to be only $9.99, then the $9.99 would be placed in the owners minimum withhold balance field of the owners Master file and he would not receive a check this time. Each time you run the Operating Statements, Derek will check the specified minimum check amount in the Owner/Customer file. Minimum check amount does not apply to printing expenses only Operating Statements. When the amount of an owners revenue plus the amount he has in his life to date minimum withhold balance field equals or exceeds the specified minimum check amount, the minimum withhold balance is released and added to his revenue check.
A quick alternative method to assign SPECIFIED MINIMUM CHECK AMOUNT values for several Owners at a time, is to use the Tool for Assigning Owner Minimum Check Amounts.
MIN. CHECK WITHHOLD LTD BALANCE: Life to date balances in withholding are due to minimum check amounts from Operating Statements. Only when the specified amount of minimum check is reached, or you specify minimum check amount is $0.00, will the minimum check withholding amount be released and life to date values will be cleared. When the life to date withheld amount reaches the specified minimum amount you requested in Operating Statements, the life to date amount is released to the owner and withhold fields are cleared. All minimum life to date balances should be released in December checks. Withhold balance is per owner, not per unit. Filter for Operating Statements allows for releasing withhold balances.
You have the option to Over-Ride the Minimum Check Amount value in the Owner File, when you Print Operating Statements.
OPERATING STATEMENTS & MINIMUM CHECK AMOUNTS
Minimum check withheld amount is by owner, not by unit. Current revenue, tax, federal backup withhold, state tax withhold, expense, prepayment, suspense release and prior balance values may be part of the Minimum Check Withhold file. Values are affected during the update for Operating Statements.
When you update for Operating Statements, values for current revenue and tax as part of minimum check withhold are stored until the owners minimum check withhold amount is released. Only expense values, federal tax withhold and or state tax withhold are updated to the DOI file when an owners revenue and tax are part of minimum check withheld amount. The GL number, 21011 or minimum check withholding is credited (instead of the cash account) during the Operating Statement Update.
When the amount stored in the minimum check amount life to date field of the Owner/Customer file, or the owner's amount of current net revenue plus prior withheld balance is greater than or equal to the specified minimum check amount, the amount in the minimum Check Amount LTD Field is released. When it is released, the GL number for Cash is Credited and the Minimum Check Withholding (GL number 21011) is debited. When the owner reaches the specified minimum check amount and that amount is released, the revenue and tax values will be updated to the DOI file to keep Government Form 1099 information correct. 1099 values for revenue and tax as part of minimum check withhold amounts are not updated to the DOI when you update Operating Statements. The 1099 values for revenue and tax are updated to the DOI file when the minimum withheld is Released. Expense values only will be updated to the DOI file if owner’s minimum check amount is withheld.
All minimum check amounts, regardless of how small the amount, should be released in the December revenue checks to coincide with owner’s Government Form 1099 information for the Calendar Year. Normally you will override the minimum check amount in the Owner/Customer file and enter zero (0) for minimum check amount in Operating Statement filter. Minimum check amount will be released for all owners and all units specified in the filter. Minimum check amount does not apply to printing expense only statements. You do not need transactions in the Transaction file to release minimum check withhold balances. Specify either revenue or both (not expenses) in Operating filter to release withheld balances.
Remember withheld balances are stored by owner, not by unit. When you print Operating Statements for Revenue or Revenue and Expenses, for all owners and all units, and minimum check amount is set to '0,' then all withheld balances will be released for all owners. Minimum check amount does not apply when you print expenses only.
You should release all withheld balances in December Operating Statements to correspond to Government Form 1099 values. You should specify the minimum check amount is zero (0) and all owners having a withheld balance will be released for R=revenue or B=both, revenue and expenses. Minimum check withhold amounts will not be released if you run Operating Statements for E=expenses only. To release all owners, leave the beginning and ending owner numbers blank. To release only one owner, enter the same number as the beginning and ending owner number.
HOW DO YOU SET UP A MINIMUM CHECK AMOUNT?
Enter a minimum check amount for each owner in the Owner/Customer file.
A quick alternative method is to use the Tool for Assigning Owner Minimum Check Amounts.
You can also override this amount in the filter for printing Operating Statements. From the JIB programs, select Other Reports then print the Minimum Withheld Summary Report, to see how much money you have in these fields for all owners. Withheld balance is by owner not by unit.
How do I setup a PRIOR minimum check withholding amount, when entering Beginning Data?
If you are entering Beginning Data and a Owner already has a Minimum Check Withholding Amount, the Minimum check withhold revenue is put into the Min Check Withhold LTD value of the Owner/Customer file. Click on 'Make Adjustment' and enter the dollar amount that you have withheld. The next step is to Add Journal Entries. This is for the balances you have just entered (Ex: Debit 25300-Retained Earnings and Credit 21011-Min. Check Withheld). These journal entries will depend on what your CPA advises.
HOW TO RELEASE ALL MINIMUM CHECK AMOUNTS
Select JIB program print Operating Statements. Hit the Enter key for beginning and ending owner number and beginning and ending unit number. Enter ‘Y’ to override minimum check amount in Owner/Customer file & specify zero (00.00) for the minimum check amount. You do not have to have current revenue transactions for preparing statements to trigger the release effect. Minimum check amount does not apply to printing expenses only statements. Minimum check amount does apply for revenue or both. The programs will search the Owner/Customer file for all owners withheld balance. Operating Statements will be printed for all owners that have a minimum check withheld balance from the Owner/Customer file.
When it is released, the GL number for Cash is Credited and the Minimum Check Withholding (GL number 21011) is debited.
WHEN TO RELEASE
All minimum check amounts should be released with the last revenue checks issued in December to agree with Government Form 1099 values. If any minimum withhold amount is not released, the owner most likely has an Accounts Receivable balance that is greater than his minimum withhold balance.
HOW TO APPLY MINIMUM CHECK AMOUNTS TO ACCOUNTS RECEIVABLE INVOICES
Use the Tool to Apply Minimum Check Amounts to Accounts Receivable.
HOW DO I TRANSFER MINIMUM CHECK WITHHELD BALANCES WHEN AN OWNER HAS SOLD HIS INTEREST TO SEVERAL OWNERS?
Accounts Receivable balances and minimum check withhold amounts are not transferred when selling owners interest. You will need to contact RSI for procedures.
I RAN OPERATING STATEMENTS AND MADE THE MINIMUM CHECK WITHHELD AMOUNT $0.00. WHY DO I STILL HAVE MINIMUM CHECK AMOUNTS NOT RELEASED?
The owner most likely has an Accounts Receivable balance that is greater than his minimum check withhold balance. The minimum check withhold balance can be applied to the Accounts Receivable balance in the JIB program “Tools For Operating Statements” sub-menu.
REPORTS FOR MINIMUM CHECK AMOUNTS
To see how much money you have for all owners, you can browse your Owner Master File for each individual Owner or you can print one of the reports below.
Minimum Check Withhold Summary
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