Certified Revenue Cycle Representative (CRCR) Practice Exam

According to Department of Health and Human Services guidelines, which of the following is NOT classified as income?

1. Wages from employment

2. Sale of property, house, or car

3. Investment earnings

4. Social Security benefits

The correct answer is: Sale of property, house, or car

The sale of property, house, or car is considered a capital gain rather than traditional income. When an individual sells an asset, any profit made from that sale, which is the difference between the selling price and the purchase price, is classified under capital gains and not ordinary income. This classification is important as it dictates how the earnings are assessed for tax purposes. Traditional forms of income, such as wages, investment earnings, and Social Security benefits, are recurrent and regular earnings received by individuals for work, investments, or support, and are therefore classified as income. This distinction is essential for understanding how different types of earnings are treated under Department of Health and Human Services guidelines and tax regulations.