Health Club Deduction.

[Brian EA]

Here is an interesting question.
Can an employer deduct expenses paid to a health club so that his employees can work-out?.
thanks
brian

[New York Enrolled Agent]

Here is an interesting question.
Can an employer deduct expenses paid to a health club so that his employees can work-out?.
thanks
brian

Generally, no.

Under some circumstances, gross income does not include the value of on-premises gyms (see §132(j)(4)).

But regulation 1.132-1 contains the following:
3) Application of rules to membership in an athletic facility. The exclusion provided in this paragraph (e) does not apply to any membership in an athletic facility (including health clubs or country clubs) unless the facility is owned (or leased) and operated by the employer and substantially all the use of the facility is by employees of the employer, their spouses, and their dependent children. Therefore, membership in a health club or country club not meeting the rules provided in this paragraph (e) would not qualify for the exclusion.

[AuditorTurnedGood]

I think

the statute just quoted was for exclusion from income on the membership. I would imagine that if the employer includes the value on the W2 as comp, they would be able to take the expense, right?

ATG

[Davc]

the statute just quoted was for exclusion from income on the membership. I would imagine that if the employer includes the value on the W2 as comp, they would be able to take the expense, right?

ATG

Yes........