My employer reimburses me for up to $50/month for a gym membership. When I put in an expense report, they give me a $50 check. There is no tax withheld. Do I need to report this as taxable income?
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2All tax questions require the OP mention the country.– mhoran_psprepCommented Nov 3, 2015 at 22:50
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I'm not an expert so I'll leave this as a comment, but I believe anything of value provided you by your company is taxable unless specifically declared (by IRS regulations) non-taxable (which gym memberships aren't) or trivial (e.g. use of a copy machine to photocopy a couple of personal pages), so reimbursement for a gym membership would be taxable income.– blmCommented Nov 4, 2015 at 1:39
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2 Answers
Yes, it should be included as taxable wages on your W2. While a gym at work (i.e.: on premises) is a non-taxable fringe benefit, when you're being provided an actual gym membership elsewhere - it is considered wages.
answered Nov 4, 2015 at 3:18
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This is correct, and applies to all reimbursement accounts, such as childcare or tuition reimbursement as well. Note that this would NOT apply to Flexible Spending Accounts for Medical or dependent care, as those are specifically pretax accounts for the predefined purpose.– VogieCommented Nov 4, 2015 at 17:12
If this is a big company, they should have an HR department that you could ask and that would have people knowledgeable enough to give a reliable answer.
But I believe the answer is "yes, it's taxable". I had a job a few years ago where the company paid for YMCA memberships, and that was taxable. They showed it as income on my pay stub and withheld taxes for it.
As @blm notes in his comment, anything of value that your employer gives you is taxable, except for things that are specifically declared tax exempt. The list of tax exempt things is pretty long and includes lots of familiar benefits, like employer contributions to health insurance, etc. But gym memberships were not on the list last I checked.
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Asking HR for tax advice? What's next, asking the receptionist to draft your living trust and having your gardener prescribe your medication? Commented Nov 4, 2015 at 6:47
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3HR generally knows what tax will be withheld on. That's a starting point. They also often have standard answers prepared for this sort of question ... which again may not be correct in all cases but can be a decent starting point.– keshlamCommented Nov 4, 2015 at 6:59
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2@littleadv: I know, almost as crazy as asking random people on the internet.– BrenBarnCommented Nov 4, 2015 at 7:39
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@littleadv HR is responsible for processing W-2's and W-4's and other tax forms, and for determining how much to withhold from your paycheck. In a big company they should have lawyers or tax accountants or access to such people so that they can do all this correctly. And of course I wouldn't ask my gardener to prescribe medication. I always ask a government bureaucrat, because they must be knowledgeable about such things since they're the ones making rules about delivery of medical care.– JayCommented Nov 4, 2015 at 14:07
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@Jay oh, you're of those who think the regulation is a bad thing, and wants to live in Mogadishu... Sorry, you just discredited yourself to a level where I think a 3-year old knows better than you. Commented Nov 4, 2015 at 16:42