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Back  RFI # 716: Tax amount placement

Formal vs. Informal Help Informal Formal

Submitter

Chip Evelsizer

Description

Some state jurisdiction rules include mandatory tax charges. These taxes apply to both products and services. For example, in MN, a sales tax for products may apply or a special MN Care Tax may apply for services.
The 837 Prof 4010A1 includes a single AMT segment at the service line level. The segment is named Sales Tax Amount and uses a qual of ‘T’ which represents Tax and is intended as a supplemental value to the line charges in SV102.
It is assumed that the MN Care Tax and the MN Product Tax would not both occur on the same service line. The tax rate for the Care Tax is not the same as the rate for Product Tax.

Q:
What tax amount values are allowed to be submitted in the Sales Tax Amount AMT segment?
Where would the service related tax amount, such as the MN Care Tax be carried in the 837 Prof if it is not carried in the Sales Tax Amount segment?
If only a "Sales Tax" amount is allowed to be submitted in the Sales Tax Amount segment, how and where is Sales Tax defined in the Imp Guide?

Submitter Assigned Keywords

tax

Response

In the 004010A1X098 Implementation Guide there is not a segment designed to specifically carry the MN Care Tax or for that matter any other State or Jurisdictional Tax identified by a name other than "Sales Tax". As you indicate, it appears from documentation from the MN Department of Revenue that medical supplies and services may be subject to the MN Care Tax or Sales Tax, but never both taxes. The Authors of this Implementation Guide do not know if this is the case in any other State that may have a same or similar Tax. The Implementation Guide does not provide a definition of Sales Tax. However, the AMT - Sales Tax Amount was designed to report the amount of a line item charge related to Tax.

Recommendation

The Authors of this Implementation Guide recommend that the MN Care Tax amount be reported in the AMT - Sales Tax Amount segment as if it were a "Sales Tax" using the same requirements as defined in the Guide for such Tax reporting. The Work Group will consider future changes to better address this need in the next version of this transaction.
Submission 12/24/2008
Status Date 2/17/2009
Status F - Final
Primary References
Document 004010X098A1
Section3
Page463
Set ID837
Loop2400
Segment Position475
Segment IDAMT
Industry NameSales Tax Amount