I have a silly question regarding ma/pds and pdp with no premium. Is enrolling people in $0 premium products considered sales or enrollment? Since a transaction usually means a transfer of some sort of asset, and since the enrollee is not paying the enrolling agent any money are you being paid for enrollments or sales? I know it sound nitpicky but is there a difference in the letter of the law?
A silly question
- Thread starter g1bass
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I would have to say sale.
While they client is not paying a premium, Medicare is for them. The client is authorizing Medicare to pay the insurance carrier for their health services. So, there is a transaction taking place, just not at the client level per say.
While they client is not paying a premium, Medicare is for them. The client is authorizing Medicare to pay the insurance carrier for their health services. So, there is a transaction taking place, just not at the client level per say.
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- #3
you have to admit tho, that medicare advantage is very unlike other insurance in many ways. It must be approved and compliant to the Federal government, rather than state gov, which is the point Universal is trying to make vis a vis minimum financial reserves, that as a federally mandated plan it neednt observe Florida law regarding minimum reserves.
- 1,704
And, you might add, Medicare has to approve that enrollment. Hence we don't get paid until company has that recipient fully approved.
I caught the reference to Univ Healthcare....and their reserve contention. Any new news on that? I believe FL DOI was using the HMO reserve requirements, which did not apply to them.
Of course, they're not paying us agents yet either.
I caught the reference to Univ Healthcare....and their reserve contention. Any new news on that? I believe FL DOI was using the HMO reserve requirements, which did not apply to them.
Of course, they're not paying us agents yet either.
- 7,066
There are no silly questions, only silly people who criticize people for asking questions when they aren't sure of the answer.
Since IRS considers it income, I really think that is the ultimate answer. If an insurance company is trying to consider it as something different it is probably because it is in their best interest and not the agent's.
Doesn't a Med Supp also have the same criteria? It has to be approved and compliant with Fed Govt rules and regulations as opposed to any state regulations. Am I missing something? My "silly question" is, if I am, please let me know. I have never heard that question raised before.
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- #6
- 7,790
My advice, don't try it! The fee is income and is taxable----transaction or no transaction. The Internal Revenue Code specifically states that all income (which has been defined many times by the courts) is taxable unless specifically excluded in the Code. Some insurers hire enrollers to enroll employees of firms into their plans. The enrollee does not pay the enroller, the employer does not pay the enroller, but you can bet your bottom buck that the fee paid to the enroller by the insurer is considered ordinary income and must be reported as such. AFLAC reps sometimes hire enrollers to do that work for them.
Many tax evaders have tried all kinds of ludicrous arguments why certain income is not taxable. Besides fines, many enjoy the hospitality of Uncle Sam for a couple of years.
Many tax evaders have tried all kinds of ludicrous arguments why certain income is not taxable. Besides fines, many enjoy the hospitality of Uncle Sam for a couple of years.
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Included among the "tax evaders" are the "tax protesters" who allege the income tax is unconstitutional. Some even write books about it,e.g., Irwin Schiff who I believe is currently residing at one of Uncle's luxury hotels.
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There are so many "if's" in this subject that can be debated. You can argue that Med Supps are in fact "guaranteed issue" during the open enrollment period since if someone applies for one an insurance company must issue the policy without any questions. In Missouri we have a guaranteed issue each year on the anniversary of the policy.
However, for those replacing one Med Supp with another one generally they will have to answer health questions. That would really create a mess wouldn't it?
I've got to go with Arnguy. Anything you receive including a trip you have won is going to be considered income.
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Back to the OPs question, I consider it both - but first and foremost a sale. For sure. You'd be surprised that sometimes for some people to 'give' something away can be harder than tagging a price tag to the product. Further, spin it how you want, enrollment, transaction, processed, etc. etc. to name a few, I, as other life agents I know, use those terms when selling life insurance with a premium, for example. "I'll be in your area enrolling tomorrow," for example, or "to get the you in the system and have your banking processed at a reduced rate, do you do your banking at a local credit union or regular bank?" So it's a matter of opinion I think but anytime there's some kind of product with consumers and an exchange is made = sales. Some would say bartering is even sales... I tend to agree. What do you all think?
