Meeting Minutes: Regents Advisory Committee on Accounts Receivable (RACAR)
Date: November 18, 2004
Location: Macon State College
Meeting was called to order by Donja Tripp, Chairman of RACAR. Donja first announced that Holley Schramski resigned her office of Secretary due to a recent promotion to the Associate Vice President and Controller of the University of Georgia.
It was then suggested by Donja that Lisa McCleary, Director of the Bursar’s Division at the University of Georgia be appointed Secretary through the spring 2005 meeting. This appointment was accepted by Lisa McCleary.
Non Resident Tax/Scholarship Issues
Topic presented by Susan Caldwell, International Tax Coordinator, The University of Georgia. Her position at UGA is to make sure that all payments to foreign nationals are taxed appropriately and reported to the IRS.
Susan started off by indicating that she is following Section 1441 of the IRC in regards to withholding federal income tax from all payments made to or on behalf of foreign nationals. She stressed in this statement that on behalf is very important to pay attention to not just payment to but ON BEHALF. Second, treasury 1.1461-2 requires that all such payments be reported to the IRS.
She then continued by discussing the types of payments that are generally made and then determining whether the individual is a non-resident alien or resident alien for tax purposes. To determine the status as NRA or RA she must compute the Substantial Presence Test.
Substantial Presence Test – if a student is on an F1 Visa they will be exempt from counting days until they have been in USA for 5 years.
If the payment is a scholarship payment it must be decided what is the qualified portion or non qualified portion. If it is non qualified then any payment to a NRA will be taxed at 14%. All non qualified scholarships paid to non-resident aliens must be reported on Form 1042S. The NRA will include the information on the 1040NR that they will complete for the tax year the payments are received. Susan indicated that she holds sessions on UGA’s campus to assist students in preparing their tax forms. She does this in cooperation with the Office of International Education on campus.
Susan’s suggestion for the scholarship payments is that the schools keep the funds from disbursement to the student until all of the tests have been completed to determine if 14% of the scholarship needs to be w/h.
Fellowship payments are subject to 14% tax, awards and prizes are subject to 30% tax.
Employment Income – it is important to collect all of the required documents from the foreign national, possible through the employee orientation process. These documents are the passport, visa, 1-94 and immigration. Once these documents are received they will be reviewed to determine if the employee is a NRA or RA for tax purposes, do they have a tax treaty, W4 allowance and the FICA w/holding.
She also talked about payment types of honoraria payments and the rules to apply in making these payments. Reimbursing expenses, payments to visitors and payments for services outside of the USA. With each of these topics she the rules to apply in making payments for these types of services.
Social Security Numbers – procedures changed effective October 2004. To apply for a SSN individual will need to show employment intentions. This could cause a problem with Athletes on campus.
ITIN – procedures changed December 2003. Difficult to assist in getting an ITIN.
I-9 form – important for the campuses to complete these forms properly. This will be important in tracking employment dates and change of visa status.
IRS Audits – Susan wanted everyone to be aware of the issues surrounding the schools in that the IRS is currently auditing many schools across the country including Georgia State University and the fines that can be assessed are significant in nature.
To close Susan discussed that she uses a software system to assist her in the required calculations and document collection. She is currently using Windstar International Tax Navigator from Windstar Technologies, Inc. She also said that there is another company Arctic International that also has a product available to assist schools.
Susan’s website information is: http://www.busfin.uga.edu/payroll/itc/
Miscellaneous Topics
Internal AuditReconciliation Memo
Reports are due November 30, 2004. Information about the Banner Accounting Feed Report (TGRFEED and the Accounts Receivable Reconciliation Report (TGRRCON) can be found in the SSCT Banner Documentation Bookshelf. Information on how to do these reports can be found at http://swdist.banner.usg.edu/ - contact OIIT customer service if you need assistance with access to this site.
Also, there is a power point presentation put on by Deidre Crawford and Amanda Marshall available at: http://www.usg.edu/oiit/summit/2004/agenda/proceedings/ban_ps_reconc.pdf
Rich Loftus indicated that the Board of Regents is having trouble getting schools to us e TGRRCON. He indicated the goal is to get to the point where the report will assist schools in the reconciliation process.
There was discussion regarding the reports ZAQFREC and ZAQFDTL and why schools are not using these reports. Some indicated that the reports take too long to run.
Tracyee Martin, Valdosta State University discussed that they have a problem on campus with who they need to go through to get issues resolved. Delete: She would like to see something from the BOR to schools mandating that schools must set up A/R in Banner.
Tracyee ask about a BOR mandate regarding access to Banner processes. Rich mentioned that the BOR can not mandate Banner access issues, that is an institutional issue. An additional question was asked regarding whether schools could pick and choose to implement parts of a Banner upgrade. The answer is yes but Amanda Marshall indicated that this could cause Banner support issues with OIIT if schools operating this way. She also indicated that access restrictions can be made at the school level and that rather than the school not implementing a piece it would most likely be an access issue.
Rich Loftus indicated that if schools were not able to reconcile it is possible that a journal entry was not booked when moving from cash basis to accrual basis.
Write-Offs
Discussion about the Senate Bill 73 and the increase in the write-off amount to $3,000.
Draft of the procedures was due out the week of November 15, 2004 to the schools. The new procedures will be effective June 30, 2005. Final version is expected out in January. An issue with the draft that was released may be the number of days that the account can be written off would be 90 days???
Handout given at the RACAR meeting is not to be considered as the procedures established for write-off. Disregard the last bullet on page 2 showing the entries to be completed.
After some discussion on the write-off policies/procedures there was clarification that Banner will not automatically generate transactions for write-offs.
1098-T Update
Regulatory updates due in November 2004 with Versions 5.4.2 and 6.1.1. The process is anticipated to work exactly like it did in 2003. There are no changes anticipated.
There is some talk in Institutional Research that they will be collecting the information in IPEDS reporting. Not sure at this point how far the talks will go.
Touchnet Contract
Touchnet will be replacing GaNet effective July 1, 2005. It is important that everyone understand the GaNet interface will not be supported after that date.
This is a payment gateway that will be able to process credit cards and web checks. Touchnet will be hosting the solution. This will allow for credit card information to not be stored on campus.
Touchnet is CISP compliant.
Rich Loftus indicated that the CBO’s on campus should have already received a bill for this e-commerce solution.
Installation Training is being offered on December 1 and 2 for the technical configuration and on December 3, 2004 which will be for technical staff and a functional bursar type employee.
6 USG schools are currently using this solution for their e-commerce.
Rich Loftus indicated that this process is not mandated, but the schools will receive a bill for the product.
This product will eventually be enhanced to include e-bills, e-disbursement and a cashiering solution.
The cost associated with the product does not include the cost of the equipment.
Convenience Fee
Carol Payne from Georgia Tech, discussed how GT is charging a convenience fee. The are currently charging $25 on Visa, Discover and American Express transactions processed on-line. They are no longer taking Mastercard since GT is not charging the convenience fee on students using web check. Mastercard regulations require that to charge a convenience fee that it must be charged both credit card and on-line check payments. She indicated that if VISA asked them to stop charging a fee she would then pursue options with a third party (possibly Touchnet) to process their credit card payments. The rate that they would charge to the student is around 2.9% of the transaction amount.
Carol did say that through all of this her walk-up payments have not increased.
Tuition Study
Not discussed
A/R Sole Receipting Update
Session was presented by Deidre Crawford and Amanda Marshall from OIIT. Information on conversion, direct deposit, direct debit, non-student receipting, and A/R general reporting was presented to the group during the two hour time slot. The product is scheduled for release to the institutions by March 31, 2005. All institutions should be prepared to use Banner for receipting by July 1, 2005. PeopleSoft Accounts Receivable will not be supported by OIIT after July 1, 2005. It was recommended that institutions begin cleaning up their non-student receivables prior to moving them into Banner.
Old Business
Minutes from the Spring 2004 meeting were approved.
No additional old business was presented.
New Business
According to the RACAR bylaws the new officers will be elected in the Spring 2005. A nominating committee was formed to determine nominees for Vice Chairman and Secretary. The committee members are Julian Veal, Augusta State University, Susan Crozier, Georgia State University and Dana Turner, North Georgia College and State University.
Donja Tripp will serve as Chairman at the spring 2005 meeting with Debbie Powell, Georgia Southern University taking over as Chairman effective July 1, 2005.
It was suggested that in planning the spring 2005 meeting that it not be held on a Friday.
The meeting was adjourned.
Minutes submitted by Lisa McCleary, Secretary