Agate CPA June Newsletter: What Happens After We Die, Big Changes, Gym Deductions

Is Your Gym Membership Deductible?

The answer is usually no – gym memberships are typically non-deductible personal expenses. However, there are some instances that fall into the maybe category. 

Here are a few:

1. You may be able to claim a medical deduction on your personal tax return if your gym membership is a medical necessity. For example, if your doctor prescribes exercise as part of a treatment for a diagnosed medical condition or if your physical therapist sends you to the gym specifically to treat an injury.

   The catch: Medical expenses are personal deductions that require you to first itemize and then the total medical costs to be deducted must exceed 7.5% of your overall income. So even if you do have a tax-deductible gym membership, you’ll (unfortunately) need a lot of other out-of-pocket medical costs to maybe see a tax benefit.

2. Are you a self-employed personal trainer? It’s likely your gym dues aren’t merely a personal expense, but ordinary and necessary to run your business and potentially tax deductible.

3. If you’re an employer providing health facility access to your employees, you may be able to deduct the related cost. Be careful here because this benefit could also be taxable to your employees depending on how it’s structured. 

Alert! Shady “tax strategy” companies will sell you expensive “tax plans” designed to allow you to deduct your swimming pool and other personal costs. Much of this wouldn’t hold up under IRS exam. If it sounds too good to be true, it probably is.