id = "1099-money-between-own-accounts-pays-no-one"
title = "Paying the card bill, reimbursing a member, or paying down a loan pays no payee"
rule = """
A 1099 reports payments made to the payee. Money moved between the payer's
own payment sources (its bank paying its card's balance, reimbursing a
member who paid for it, paying down a loan's principal) pays no payee, even
when the entry is tagged with the card issuer, the member's payee record or
the lender: the movement out of one source is offset by the movement into
the other.
"""
status = "CONVENTION"
sources = [
  "26 U.S.C. §6041(a) (payments made to the payee: docs/spec/sources/irs-1099-thresholds.md)",
  "wanderbooks P3 review R1 (2026-10-20): netting an entry's payment buckets",
]
tags = ["1099", "netting"]

[setup]
currency = "USD"
fiscal_year_start = "01-01"
basis = "cash"
rounding = "half-away-from-zero"
cash_accounts = ["1000"]
financing_accounts = ["2100", "2500"]

[[setup.accounts]]
code = "1000"
name = "Bank"
type = "asset"

[[setup.accounts]]
code = "2050"
name = "Company card"
type = "liability"

[[setup.accounts]]
code = "2100"
name = "Due to Members"
type = "liability"

[[setup.accounts]]
code = "2500"
name = "Equipment loan"
type = "liability"

[[setup.instruments]]
label = "Harbor Visa"
kind = "business_card"
account = "2050"

[[setup.payees]]
name = "Harbor Card Services"
form = "1099-NEC"

[[setup.payees]]
name = "Harbor Equipment Finance"
form = "1099-NEC"

[[events]]
date = "2026-05-25"
description = "Card bill paid from the bank"
payee = "Harbor Card Services"
lines = [
  { account = "2050", side = "debit", amount = "1200.00" },
  { account = "1000", side = "credit", amount = "1200.00" },
]

[[events]]
date = "2026-06-01"
description = "Loan principal"
payee = "Harbor Equipment Finance"
lines = [
  { account = "2500", side = "debit", amount = "3000.00" },
  { account = "1000", side = "credit", amount = "3000.00" },
]

# By hand: the bill: +1,200.00 out of the bank, −1,200.00 into the card's
# account: nets to 0.00 in every bucket. The loan: +3,000.00 out of the
# bank, −3,000.00 into the loan (a financing account): 0.00.
[[expect]]
query = "vendor_1099"
payee = "Harbor Card Services"
from = "2026-01-01"
to = "2026-12-31"
values = { status = "under_threshold", threshold = "2000.00", paid = "0.00", excluded_card = "0.00", undetermined = "0.00", not_reportable = "0.00" }

[[expect]]
query = "vendor_1099"
payee = "Harbor Equipment Finance"
from = "2026-01-01"
to = "2026-12-31"
values = { status = "under_threshold", threshold = "2000.00", paid = "0.00", excluded_card = "0.00", undetermined = "0.00", not_reportable = "0.00" }