IRS Publication 1281 explains when to begin backup withholding.  Knowledgebase ID 48551 is what we used a few years ago.  It worked well following the steps.  On Step 2, we used the Invoice Level.  On Step 4, we used Include misc deduction in 1099 totals, we did NOT round, and we sent GL entries when Payment is Posted.  We setup a new liability account in General Ledger called Backup Withholding which we needed for Step 7. IRS Publication 1281 gives the current percentage (which can change from year to year) and answers to frequently asked questions.  The amounts deducted for backup withholding must be paid over using the EFTPS tax system and the frequency is outlined in IRS Publication 15.  Backup withholding requires an annual return, Form 945.  You will also send the vendor a Form 1099 at year end that reports the total amount paid and the total amount of backup withholding. 

I used KB 44097 as a guide.