Skip to main content

Texas Department of Insurance designated doctor examinations sales tax

By November 10, 2022Texas Sales Tax
Texas Department of Insurance designated doctor examinations sales tax
The Texas Comptroller of Public Accounts ruled that charges for designated doctor exams ordered by the Texas Department of Insurance, Division of Workers’ Compensation (DWC), are taxable insurance services. The DWC orders exams to evaluate an injured employee’s medical condition and to resolve disputes about worker’s compensation insurance benefits regarding a work related injury or illness. The exams are not medical treatments and do not establish a physician-patient relationship. They are performed to determine the appropriate level of workers’ compensation benefits.  These are activities to handle, investigate, adjust, and/or pay claims or losses, and the activities meet the definition of insurance claims adjustment or claims processing under Tex. Admin. Code § 3.355(a)(8). Charges for exams are subject to Texas sales and use tax. Designated doctors are responsible for collecting and remitting sales and use tax on charges to workers’ compensation insurance carriers for exams. The doctors may accept an exemption certificate in lieu of collecting tax on exams for exempt governmental entities described by Tex. Tax Code Ann. § 151.309, such as self-insured political subdivisions, or to religious, educational, and public service organizations described by Tex. Tax Code Ann. § 151.310. (Texas Private Letter Ruling No. 202210014L, 10/20/2022.)
Texas Department of Insurance designated doctor examinations sales tax
Ansari Law Firm

Author Ansari Law Firm

More posts by Ansari Law Firm

Leave a Reply