IRS 1099 reporting is a critical compliance process in the United States, requiring businesses and financial institutions to report various types of non-employee income—such as payments to freelancers, interest, dividends, and rent—to the Internal Revenue Service (IRS). This ensures transparency and helps the IRS track income that may not be captured through traditional employment reporting. 

For years, Dynamics 365 Business Central has supported 1099 reporting through a familiar and straightforward process. Users could configure 1099 form boxes, designate vendors as 1099-liable, and manage reporting through the purchasing and payment workflows, culminating in year-end printing on preprinted IRS forms. However, due to frequent and often last-minute changes from the IRS—typically released in October or November—Microsoft had to delay updates, creating a stressful and unsustainable cycle for partners, customers, and users alike. 

Recognizing the need for a more resilient and modern approach, Microsoft has introduced a completely new 1099 reporting experience. This is not a redesign of the existing functionality, but a brand-new solution delivered as a preinstalled, standalone IRS Forms app in U.S. Business Central environments. This shift brings a fresh architecture and process flow, from setup to submission, with the most significant change occurring at the end of the reporting cycle. 

What does this mean to you? 

You can stop ordering preprinted 1099 forms from IRS. The new IRS Forms app no longer supports printing on preprinted forms. 

This change is driven by two key factors: 

1. Regulatory Compliance: In this moment, businesses filing 10 or more information returns, including all 1099 forms, are required to file electronically. This threshold means that even small businesses are now likely subject to e-filing requirements. 

2. Technical Simplification: Supporting preprinted forms is complex and error-prone, as even slight variations in form layout can cause misalignment. It also meant customers had to wait for Microsoft to release updates each year to unblock you. With digital files, updates are easier to manage, and the submission process becomes more reliable and efficient. 

But we haven’t forgotten about your vendors. The new app allows you to generate substitute 1099 copies with the same content as the official forms, which can be printed or emailed automatically. These reports are also configurable, enabling you to add new form boxes without needing support from Microsoft or a partner. 

We won’t cover all the new features here—there are many productivity enhancements worth exploring. We encourage you to review the full documentation: : https://learn.microsoft.com/en-us/dynamics365/business-central/localfunctionality/unitedstates/introduction-to-the-irs-forms.  

Get Ready Now 

Before this change becomes mandatory, we strongly recommend enabling the new IRS Forms app in your sandbox environment and testing it alongside your upgrade process as soon as possible. This will ensure a smoother transition and help you adapt to the new workflow with confidence. To do so, just enable new 1099 forms on the Feature Management page. 

Stay tuned. Based on early feedback from partners and MVPs, we’ll be rolling out additional improvements before the end of the year. 

The post Business Central and IRS 1099 Reporting in the USA: An Important Shift Ahead  appeared first on Microsoft Dynamics 365 Blog.

In today’s retail landscape, payments have evolved into a strategic inflection point—where customer expectations, brand trust, and operational efficiency converge. No longer just the final step in a transaction, payments shape the overall customer experience and directly influence conversion, satisfaction, and loyalty. As consumers engage across physical stores, mobile apps, and digital platforms, they demand seamless, secure, and flexible payment options tailored to their context. At the same time, as retailers expand into new geographies, they must navigate a complex landscape of local payment preferences, regulatory complexities, and asynchronous processing requirements. Retail payment innovations are clearly needed.

A New Solution in Partnership with Adyen

Meeting these demands requires a payment infrastructure that’s not only omnichannel and secure, but also globally adaptive—capable of scaling across geographies while delivering localized, compliant, and consistent checkout experiences. In short, payments are not just an operational necessity—they’re a growth lever and competitive differentiator in an increasingly borderless retail economy. Dynamics 365 Commerce, in partnership with Adyen, offers a native payment connector which enables retailers to meet this challenge head-on, offering a modern approach to payments that supports global expansion, operational efficiency and elevates customer experience. 

Adyen is a global payment platform serving almost 100 countries and expanding rapidly. It supports a wide range of payment methods across regions and channels—from credit cards and digital wallets to Pay by Bank (open banking) and BNPL providers. Its unified commerce approach allows retailers to consolidate payment processing, fraud prevention, and reporting into a single system. The payment connector to Adyen is maintained and continuously enhanced by the Dynamics 365 Commerce product team in close collaboration with Adyen, which not only reduces technical overhead, but delivers secure, flexible checkout experiences across both physical and digital storefronts.  Recent updates focus on enabling secure, mobile-ready operations—empowering retailers to offer greater payment flexibility to consumers while positioning their businesses for future geographic expansion. 

Let’s explore some of the latest retail payment innovations helping retailers achieve these strategic goals. 

Wallet Payments 

NFC based wallets like Apple Pay, Google Pay, and Samsung Pay have moved from novelty to necessity. These contactless options not only offer enhanced security through tokenization but also speed up checkout times significantly. In addition to NFC wallets, the QR code-based wallets like Alipay, WeChat Pay, PayPay etc. enhance customer convenience and satisfaction. These digital payment methods offer a fast, secure, and contactless way to complete transactions, catering to the growing preference for cashless payments. Dynamics 365 Commerce leverages Adyen to help the merchants easily enable these wallets, and attract a broader customer base, including tech-savvy shoppers and international tourists who rely on these platforms. 

Buy Now, Pay Later (BNPL) 

BNPL services have exploded in popularity, particularly among younger shoppers. By offering instant financing options at the point of sale, retailers can increase average transaction values while giving customers the flexibility they crave. Merchants using Dynamics 365 Commerce with Adyen connector can leverage BNPL providers such as Klarna and Affirm in stores which can help increase the Average Order Value without burdening the customer’s wallet. 

Mobility to In-Store Payments 

Enabling store associates to take payments wherever the customer significantly enhances the shopping experience by offering convenience and flexibility. This fundamentally changes the in-store experience by: 

• Reducing checkout lines and waiting times 

• Enabling personalized service where customers are, rather than forcing them to a central checkout 

• Allowing for immediate product information, inventory checks, and payment processing in a single interaction 

• Creating opportunities for clienteling and relationship-building throughout the shopping journey 

 A development in retail payments is the rise of using mobile phones for payment capture, particularly Apple’s Tap to Pay on iPhone. This technology transforms standard iPhones into payment terminals, eliminating the need for traditional POS hardware. Merchants can now run the Store Commerce application on iPhones and leverage Adyen connector to accept the NFC based card payments on the iPhones. 

 Similarly, Android-based All in one payment terminals such as Adyen’s Castle devices enables the retailers to run the Store Commerce app from Microsoft and capture card and wallet payments.  

Pay by Link 

The Tap to Pay on iPhone is great for NFC based card payments while Android Castle devices are great for all types of cards i.e., with or without NFC chips and QR code-based wallet payments, however, supporting local payment methods which require asynchronous processing is usually a challenge. These payment methods require the commerce solution to listen to payment notifications from the payment processor and process the transaction accordingly. Dynamics 365 Commerce now supports a new payment method from Adyen named Pay by Link which generates an Adyen hosted payment link. Opening the link directs the in-store customers to a secure checkout page on their phones, enabling various payment methods supported by Adyen, including the local payment methods which require asynchronous processing.  

It’s important to call out that the Pay by Link payment method does not require any specialized hardware such as payment terminal or special tablets and does not even require a hardware station which means that even the web-based cloud point of sale can accept digital payments without a need to maintain a hardware station in the store. Pay by Link can be very effective for line busting scenarios as the store associate can scan the customer items and generate a payment link for the customers and suspend the transaction. The customers can make a payment while in line and when they reach the cashier’s counter, the cashier can recall the suspended transaction, print receipts and complete the transaction. 

 Using these various options, Dynamics 365 Commerce empowers merchants to accept payments anywhere—from pop-up shops to home delivery—while maintaining brand consistency and security standards. These mobility options also enable a more efficient use of floor space and help merchants to rapidly scale operations for seasonal demands without investing in additional terminals. 

Intelligent payment routing: the hidden cost-saver 

While consumers rarely think about payment processing networks, retailers know that every transaction carries costs. When a customer uses a debit card, the transaction can potentially be processed through multiple networks. While many retailers default to major card networks, regional debit networks like STAR, NYCE, and PULSE often offer substantially lower interchange fees. 

Merchants using Dynamics 365 Commerce can now benefit from Adyen’s capability to automatically identify eligible transactions and route them through the most cost-effective network. A retail payment innovation resulting in significant savings for merchants —without any change to the customer experience. 

Productivity through consistent user experiences 

The benefits of modern payment solutions extend beyond the customer-facing advantages to significantly impact associate productivity. When store employees interact with a consistent, intuitive user interface across all point-of-sale functions, training time decreases while efficiency soars. 

Dynamics 365 Commerce now supports a unified payment experience across all payment methods. This enhancement is aimed at eliminating the cognitive burden of switching between different interfaces for various payment methods. Associates can move seamlessly from processing a standard credit card payment to handling a BNPL transaction or a gift card payment without missing a beat. This consistency reduces transaction errors, speeds up checkout times, and allows staff to focus on customer service rather than struggling with cumbersome payment processes.  

The new payment flow is really a step in the right direction. There are numerous options available today, whether it’s cryptocurrency, financing, or other digital payment methods. The ability to easily navigate payment is important for both our company and the customer. Everyone will have a preference and being able to accommodate that easily allows our staff to focus on the customer instead of trying to coordinate complex exchanges between systems. We see a lot of potential in this style of payment flow, streamlining the process and reducing unnecessary button grids.

– Chad Davison, IT Systems Team, Memory Express Inc. 

Embedded fraud protection: securing the transaction ecosystem 

As retail payment innovations evolve, so do the tactics of fraudsters. Retailers with robust fraud protection not only minimize direct losses but also preserve customer trust. Dynamics 365 Commerce now enables the merchants to leverage the built-in risk management capabilities in Adyen for ecommerce and Pay by Link transactions. Any fraudulent transaction prevented represents both saved revenue and a protected customer relationship.   

Enabling post-visit and remote payment experiences 

Dynamics 365 Commerce continues to expand its support for asynchronous payments, aiming to give merchants greater flexibility in how and when customers complete transactions. One such planned future enhancement is the ability for store associates to generate orders—including shipping details—and send a secure payment link to the customer, enabling them to finalize the purchase at their convenience. If payment isn’t completed within a specified timeframe, the system can automatically cancel the order and release the inventory. 

This approach supports more flexible purchasing journeys, for example, when a customer needs time to consider a larger purchase. Future enhancements also aim to extend this capability to call centers, allowing representatives to send secure payment links instead of collecting payment information over the phone. This would support additional modern payment methods and improve both security and customer experience for remote transactions. 

Bringing It All Together 

Retailers making the most of today’s retail payment innovations often take a unified approach, treating technologies like digital wallets, BNPL, Pay by Link, and mobile SoftPOS not as isolated tools but as components of a cohesive payment strategy. With support for these capabilities, along with Adyen’s built-in risk management and intelligent routing features, Dynamics 365 Commerce helps merchants design payment experiences that can enhance convenience, improve operational flexibility, and support security standards. 

As the payment landscape continues to evolve, success will hinge not on selecting a single technology, but on integrating multiple options to align with customer preferences and operational needs. By building a flexible, future-ready payment foundation, retailers can better adapt to changing expectations and create experiences driving efficiency and customer satisfaction. Learn more about other retail payment innovations, along with what is new and what is coming to Dynamics 365 Commerce in our release planner.  

The post Next-Gen Retail Payments: Trends, Tech, and Transformation using Dynamics 365 Commerce + Adyen  appeared first on Microsoft Dynamics 365 Blog.

We’re entering the age of AI agents, a transformative moment reshaping the landscape of business applications and platforms. AI agents aren’t just making incremental improvements, they’re helping to redefine productivity and can fundamentally change how work gets done.

Published today, the 2025 release wave 2 for Microsoft Dynamics 365, Microsoft Power Platform, and Copilot offerings introduces new and improved capabilities that help organizations to harness the full potential of this new era. These plans compile new capabilities slated for release between October 2025 and March 2026.
Integral to the wave 2 plans, AI assistants and agents not only help humans with day-to-day tasks, but also act as proactive partners to drive better business outcomes. Our upcoming release brings that vision to life, helping to make AI not just accessible but an essential component in daily operations. Whether it’s enabling sellers to close deals faster, providing service teams real-time trusted knowledge, or empowering finance professionals with AI-driven reconciliation and analysis, these enhancements can be transformative to the way we all work.

Be sure to stay updated on the latest features and create your personalized release plan using the release planner.

Highlights from Dynamics 365

The 2025 release wave 2 for Dynamics 365 brings new innovation to transform functions across your business.

Microsoft Dynamics 365 Customer Insights – Data enhances Microsoft Copilot and agents with real-time, unified customer profiles, enabling teams to act on insights within their workflow. With enriched data, seamless platform integration, and faster processing, businesses can deliver timely, personalized experiences that boost engagement and conversions.

Microsoft Dynamics 365 Customer Insights – Journeys empowers businesses to craft personalized, AI-driven customer experiences across all touchpoints. With Copilot, agents, and enhanced orchestration tools, teams can engage the right audiences at scale, streamline lead generation, and accelerate growth.

Microsoft Dynamics 365 Sales brings the power of AI to help sellers achieve their targets and automate busywork. Microsoft Copilot delivers actionable insights in the flow of work, while AI agents research and engage leads, drive purchase intent, and proactively bring key insights and emergent deal risks—helping sellers close more deals faster. A reimagined interface reorients sellers from data to insights. Watch this video to discover the new and enhanced features in this release wave for Dynamics 365 Sales.

Microsoft Dynamics 365 Customer Service continues to enhance agentic and Copilot capabilities for case and knowledge management, as well as AI-driven routing.

Microsoft Dynamics 365 Contact Center continues to enhance agentic and Copilot capabilities to automate the service journey across digital and voice channels, along with the introduction of new omnichannel and supervisor capabilities in the 2025 release wave 2.

Microsoft Dynamics 365 Field Service will deliver AI agents, enhanced scheduling tools, mobile usability improvements, and deeper Microsoft 365 integration in the upcoming release wave. With innovations across inspections, vendor coordination, and connectivity with Microsoft Dynamics 365 Project Operations, Field Service empowers organizations to deliver smarter, faster, and more seamless service at scale.

Microsoft Dynamics 365 Finance brings global-scale finance and agentic operations to our customers, including agents that can lead to faster financial close, and provide additional automation and optimization across large scale operations, as well as enhancements to business performance analytics and planning solutions.

Microsoft Dynamics 365 Supply Chain Management can enhance demand planning with event and promotion forecasting, and help improve quality management for sample handling; and the Supplier Communications Agent will automate vendor interactions. New supplier engagement tools and warehouse app upgrades will also be introduced to further streamline operations and boost efficiency.

Microsoft Dynamics 365 Project Operations will continue to deliver powerful enhancements across the project lifecycle. These include improved mobile and browser experiences for time and expense, better project planning with enterprise custom fields, streamlined billing and invoicing workflows, and expanded support for stocked items, investment projects, and migrations to the modern architecture.

Microsoft Dynamics 365 Human Resources can enhance the hire-to-retire journey with Microsoft Entra ID and Microsoft Viva Connections integration to help reduce duplication. New agentic capabilities will be introduced to streamline onboarding with guided experiences and automation. Recruiter assist will also now support job description generation and interview assistance, helping to improve efficiency across hiring and onboarding.

Microsoft Dynamics 365 Commerce advances in-store experiences by providing a mobile-first point-of-sale that provides business continuity even during a business outage. Improvements to the Adyen payment connector allows modern payments like Pay by Link across channels, offering more purchasing options for omnichannel customers. Additionally, omnichannel unified pricing enables retailers to establish more intricate pricing structures, helping them remain competitive.

Microsoft Dynamics 365 Business Central introduces AI agents to enhance efficiency and automation in the 2025 release wave 2. These agents seamlessly integrate to execute complex tasks, generate reports, automate processes, and optimize order creation using natural language processing. Additionally, this release focuses on quality management, subcontracting, sustainability, and e-document capabilities.

Highlights from Microsoft Power Platform and Microsoft Copilot Studio

2025 release wave 2 updates for Microsoft Power Platform bring new and updated ways for organizations to analyze, act on, and automate data to digitally transform their businesses.

Microsoft Copilot Studio continues its journey to make agent creation and operation even easier and more powerful with autonomous agents in Microsoft 365 Copilot, the ability to build complete teams of agents that work seamlessly together, and improved governance for enterprise scalability. Copilot Studio will offer even deeper integration with Azure AI Foundry and the Microsoft Graph, helping to ensure your agents can use the latest AI technology in coordination with your data in Microsoft Graph. Watch this video to discover how the latest enhancements to Copilot Studio can benefit your business.

Microsoft Power Apps enhances human and agent collaboration with a new agent feed to supervise the work of agents and extensible built-in agents for common tasks like enter, explore, visualize, and summarize data. Bring business problems to Plan Designer and a team of agents will help you build enterprise solutions, including apps, agents, Microsoft Power BI reports, and more. Vibe code with the App Agent to create data-connected experiences—just describe what you need or provide an image, and it can be done.

Microsoft Power Pages enables businesses to build secure, data-driven portals effortlessly. In this wave, we will further expedite site building for low-code makers and pro developers to help build intelligent sites for your employees, customers, and partners. The introduction of enhanced security agent features will further empower low-code makers, pro developers, and admins with actionable insights and abilities for securing their websites.

Microsoft Power Automate is transforming how enterprises automate complex business processes through new human-in-the-loop experiences, such as advanced approvals and AI-native capabilities, such as generative actions and intelligent document processing. To manage complex automations at scale, a comprehensive suite of governance, observability, and security controls will be introduced to the Automation Center and Power Platform admin center.

Microsoft Dataverse continues to serve as a trusted low-code data platform, enabling the creation of scalable agents, Copilot applications, and automations. This update introduces enhancements to core agentic capabilities, including Dataverse for Agents and Dataverse Search to support smarter, AI-ready experiences. New features such as Dataverse Model Context Protocol (MCP) Server and AI-powered business logic tools further expand the ability to build dynamic, intelligent solutions grounded in enterprise data.

Microsoft Power Platform governance and administration will become the unified governance hub for managing intelligent agents, agent-driven apps, and automated workflows across the Microsoft ecosystem in this release wave. This will provide a secure, governable, reliable platform for agent development.

Updates to Copilot offerings

Agents for Microsoft 365 Copilot help maximize business impact across sales, service, and finance. Learn more about the 2025 release wave 2 updates for Copilot offerings. Agent updates for sales will help sellers work smarter, engage strategically, and close deals faster. Agent updates for service will expand CRM connectivity and enhance email insights and drafting—all within the tools reps use daily. Updates for finance will offer easily customizable agents that can be launched from familiar tools like Excel, boosting efficiency and insight.

Early access period

Starting August 4, 2025, customers and partners can validate the latest features in a non-production environment. These updates include user experience enhancements that will be automatically enabled in production environments by October 2025. Take advantage of the early access period to test these updates and effectively plan for your customer rollout. Explore the 2025 release wave 2 early access features for Dynamics 365 and Microsoft Power Platform or visit the early access FAQ page for more information.

For a complete list of new capabilities, please refer to the Dynamics 365 2025 release wave 2 plan, the Microsoft Power Platform 2025 release wave 2 plan, and Copilot offerings 2025 release wave 2. We also encourage you to share your feedback in the community forums for Dynamics 365 and Microsoft Power Platform.

The post 2025 release wave 2 plans for Microsoft Dynamics 365, Microsoft Power Platform, and Role-based Microsoft Copilot offerings appeared first on Microsoft Dynamics 365 Blog.

In today’s fast-moving world, it’s not enough to just hear what customers say—you need to understand what they really mean. Whether they’re talking to a voice agent (IVR) or chatting with a virtual agent, it’s important that the technology behind the scenes can truly understand them. That’s where Natural Language Understanding (NLU) comes in. It helps contact centers respond more naturally, reduce the need to transfer calls, and make every interaction smoother and more helpful. 

To help businesses improve how they talk to customers, we’re introducing NLU+, a new feature in Microsoft Copilot Studio. NLU+ is designed for companies that have a lot of customer conversations and want more control over how their virtual agents respond. It’s especially useful for teams that have collected years of chat or call data. With NLU+, they can fine-tune how their bots understand and reply, making conversations feel more personal and effective. 

Why now? Many companies are curious about using generative AI but aren’t quite ready to go all in. NLU+ offers a reliable and customizable option that gives you accurate results and full control over your data. It lets you build smart language models using your own past conversations, tailored to your business’s unique way of speaking and working. This means your agents can better understand even tricky or industry-specific language, leading to faster and more natural customer service. 

Think of NLU+ like a smart engine that gets better the more you use it. It doesn’t just pick up on keywords—it understands full sentences and the meaning behind them, letting customers speak freely and still gets what they’re saying. This makes conversations feel more human and less robotic. 

Training the model

NLU+ works by learning from examples. You give it sample conversations with notes that explain what each part means. This helps it understand full sentences instead of just following a step-by-step script. While it takes a bit of effort to set up, the payoff is a system that keeps getting better over time. If you want a virtual agent that grows with your business and keeps delivering great service, NLU+ is a great choice. 

By introducing NLU+ with other NLU’s like Generative AI, standard NLU, and Azure CLU, you can build a wide range of self-service agents. Generative AI is great for low maintenance agentic systems, standard NLU is great for rapid setups while NLU+ is better for more complex tuning needs. Azure CLU helps you connect with existing Microsoft language tools. Together, these options let you find the right balance between speed, accuracy, and control. 

Custom ontology 

An ontology is a formal representation of knowledge within a specific domain. NLU+ allows you to define your own intents, entities, and relationships using annotated data, forming your custom ontology. This gives you full control over how your agent understands and processes language. For example, in a flight booking scenario, you can define variables like origin, destination, travel date, and number of passengers. We can now add entity annotations within the topic triggers, allowing tighter coupling of intents and entities.  

Advanced slot filling

Once your data is annotated, NLU+ can extract multiple data points from a single utterance. This eliminates the need for repetitive back-and-forth questions. For instance, if a customer says, “Book a flight from Miami to Boston for two people tomorrow,” the model can simultaneously extract the origin, destination, number of passengers, and travel date. This not only saves time but also creates a smoother, more conversational experience. 

NLU+ also allows makers to add additional training data to help the model understand the many ways customers might answer a question, thereby improving entity extraction accuracy. 

Bulk data import 

NLU+ supports the import of large volumes of training data—making it easy to scale and refine your models. With simple import/export functionality, you can quickly update topic triggers, append new data, and iterate on your model without starting from scratch. This is especially useful for enterprises that need to manage multiple topics or frequently update their conversational flows. 

Consistent latency using a precompiled model

You can use the Train feature to pre-compile your model. This ensures low-latency, deterministic performance—critical for high-volume environments. The training process also includes a unique feature for voice agents (IVR), where the recognizer is trained alongside the model to improve speech recognition accuracy. Once training is complete, you’ll receive a status update, and if there are any issues, you can export the results for easy troubleshooting and refinement. 

Get started with NLU+ 

Getting started with NLU+ is simple. All you need is a Dynamics 365 Contact Center license. Once enabled, navigate to the Language Understanding section in Copilot Studio and select NLU+ as your orchestration engine. From there, you can upload your data, annotate it, train your model, and test it –all within the same intuitive interface. Once you’re satisfied with the results, publish your agent and start delivering smarter, faster, and more personalized conversations that are designed to always understand meaning. 

Learn more 

Watch a quick video introduction. 

Read the documentation: 

• Set up IVR agents in the voice channel using Copilot Studio | Microsoft Learn 

• Integrate a Copilot agent | Microsoft Learn 

• Natural language understanding (NLU) overview 

• Configure NLU+ 

• Responsible AI FAQs for NLUs in AI agents | Microsoft Learn 

The post NLU+: Fine-tuned language intelligence for smarter conversations  appeared first on Microsoft Dynamics 365 Blog.