The Conversion Date field (LNCVDT) on the Loans > Account Information > Additional Loan Fields screen > Origination/Maturity tab must contain your company's conversion date. For those companies that converted in this reporting year, the system will read the YTD Interest field (LNYTDI) on the Account Detail screen > Account tab and report that amount to the IRS. This field would include interest paid while the loan was on the prior data processing system.

WARNING: If you have a negative interest amount in the YTD Interest field, the system treats that loan as though the interest amount is $0 for IRS reporting. (We cannot report negative interest to the IRS.) It does not subtract the interest from points paid, as both items must be reported to the IRS separately.

Note: If your institution converted to GOLDPoint Systems this tax year, please verify that mortgage loans that included points paid and were opened on your previous data processor converted correctly. Points paid should be entered in the Original Loan Fees field on the Origination/Maturity tab of the Loans > Account Information > Additional Fields screen, and checkmark the Report Original Loan Fees to IRS? field. Only mortgage loans with opening dates in this tax year will be reported. This is the Date Opened field on the same screen.

Did your institution purchase any mortgage loans this year? If you have not run year-end before for mortgage loans, we’ll need to make sure your loans are all set up correctly.

The Conversion Date field (LNCVDT) on the Loans > Account Information > Additional Loan Fields screen > Origination/Maturity tab must contain the date the loans were converted to your institution. If you purchased loans this year that qualify for IRS reporting and converted them onto GOLDPoint Systems, you need to send a 1098 to all applicable borrowers. Be sure to coordinate with the selling lender to ensure you both report for the correct period, if you have decided to each report your portion of the year the loan was serviced by each institution.

Some institutions choose to report the full year of mortgage interest on behalf of the previous loan servicer and current loan servicer. In those cases, make sure the previous amount of mortgage interest collected before the purchase date shows in the Year-to-Date Interest Paid field (LNYTDI) on the Loans > Account Information > Account Detail screen > Statistics tab.

The 1098 Form is used to report mortgage interest, points, and/or mortgage insurance premiums paid to you by the borrower.

•If your institution does not have mortgage accounts, ignore this question.

•If yes, check the Yes box and refer to the 1098 Options section below for more options you can choose for year-end statements.

Note: Your mortgage loan accounts must be set up with correct information to record 1098 mortgage interest. See Requirements for 1098 Reporting for more information.

If you cancelled or forgave a debt for non-bankrupt accounts, you may need to report this on a 1099-C form. See the IRS regulation for further details.

GPS can transmit all 1099-C cancellation of debt forms to the IRS for year-end reporting. Some cancellation-of-debt forms are created automatically based on institution option T99C being set when the Full Write-off transaction (tran code 2510-05) is run. See the Write-off Transactions description in the Transactions manual in DocsOnWeb.

Other institutions choose to enter 1099-C information manually within IRS GOLD. See IRS Loan Forms > 1099-C Cancellation of Debt in the IRS GOLD manual in DocsOnWeb for more information.

You must print the 1099-C forms at your institution (using IRS GOLD) and send it to the account holders by February 1st. GOLDPoint Systems will transmit the data to the IRS.

IMPORTANT: We do not print the forms and send them to your account holders. You should review the requirements for 1099-C in DocsOnWeb. See the Loans > IRS Form 1099-C help for more information.

Note: Assumptions are rare.

If buyers assumed loans this year (e.g., another person took over the remaining payments on a mortgage loan), and the Create 1099-INT and/or the Report Late Charges as Interest to IRS field (located on the Loan Assumption screen, Seller Information tab) is selected at the time the assumption is processed, the following information is automatically sent to IRS GOLD:

•the seller's name, address, and tax ID;

•the amount of interest paid on reserves and/or late charges paid.

This information is set at the time of the assumption (on the Loan Assumption screen), not at year-end. However, it is also submitted to the IRS during year-end processing.

Some states require interest be paid when reserves are accumulated (e.g., California). There is a loan-level option (Pay Interest on Reserve 1/2? on the Loans > Account Information > Reserves > Account Reserve Detail screen > Reserve Payment tab) that allows interest to be paid on all accounts with reserves, then compiled on a 1099-INT form to be reported to the IRS at year-end on behalf of the borrower.

WARNING: If the loan is not set up properly, interest will not be paid on that account's reserves. The Pay Interest on Reserve 1? and Pay Interest on Reserve 2? fields on the Account Reserve Detail screen must be checked. The interest rate and date last accrued must be set up for each loan on the Account Reserve Detail screen > Reserve Payment tab. Because 1099-INT is cumulative by Social Security number, you will need to coordinate this information with your deposit department.

Note: Interest paid on reserves can be reported to the IRS, but it is not required. If you want to skip the reporting of reserve interest to the IRS, submit a work order requesting that option "SKLR" be set to "Yes." See Institution Options for more information.

Fees paid to brokers during the current tax year in excess of $600 must be reported to the IRS using a 1099-MISC form. This is not very common, but some of our institutions do use brokers for loan origination.

At the end of the year, the system adds all the amounts of each loan (only those opened this tax year) with the same broker number and sends the total, along with the broker name and address information, to the IRS GOLD system. You must print the 1099-MISC forms at your institution; GOLDPoint Systems will transmit the data, but we do not print the forms. Additionally, the loan must be set up as follows for the system to create the 1099-MISC for brokers:

•The Broker Number field contains the number assigned to the broker who brought this loan to the institution. This information is usually brought over from GOLDTrak PC, GOLDAcquire Plus, or other loan origination methods (APIs) when the loan is originated or transferred into CIM GOLD. However, users can also manually enter the Broker Number on the loan and on the Payee Information screen manually if that information was neglected when the loan was originally opened. The Broker Number field is on the Loans > Account Information > Additional Loan Fields screen > Origination/Maturity tab in CIM GOLD.

•The Broker Fee field, found on the same screen as the Broker Number field, contains the amount paid to the broker who brought this loan to the institution. This is also brought over when the loan is originated, but the information can be file maintained by users if numbers weren’t accurate or neglected. At the end of the year if the total amount of fees for that broker is more than $599.99, the record will be transferred to the IRS GOLD system. For example, if the broker brought on three loans that year, and each loan included broker fees of $250, then a 1099-MISC for $750 would be generated at year-end for that broker.

•The broker information must be set up on the Loans > Payee Information screen in CIM GOLD. Additionally, the Report to IRS field on that screen must be checked for that broker.