How does an insurance agent account for revenue and income? I collect full premiium, then send 85% to insurers and keep 15%. The 15% is my revenue prior to expenses.

857

1 Best answer

Expert Alumni

Mar 31, 2020 1:11:05 PM

As an insurance agent, you collect premiums on behalf of insurance companies and place them in your trust account. You are only the fiduciary of the trust account.

Therefore, you only count as revenue the commissions earned that you transfer to your operating bank account.

Expert Alumni

Mar 31, 2020 1:11:05 PM

As an insurance agent, you collect premiums on behalf of insurance companies and place them in your trust account. You are only the fiduciary of the trust account.

Therefore, you only count as revenue the commissions earned that you transfer to your operating bank account.

Level 1

Mar 31, 2020 3:38:03 PM

Thank You,

I have been sending in paper returns. Several years ago the IRS sent me a letter saying that they thought that I made $2,000,000. That is because that is what the 1099s said - which included the insurer's money that I hled in the trust account. They backed off so it turned out OK in the end. I will take your advice so that I can file electronically. Thank You

Why sign in to the Community?

How does an insurance agent account for revenue and income? I collect full premiium, then send 85% to insurers and keep 15%. The 15% is my revenue prior to expenses.