Was your New Years Resolution to lose weight? Have you already cheated or missed the gym? If so, you’re not alone. Statistics show that the number one resolution every year is losing weight and that 92% never end up doing it. But could you, as a business owner, not only help yourself, but also help your employees achieve their fitness and weight loss goals? And could it be a deductible expense?
According to the IRS, the answer could be yes. Business owners can take some tax deductions for offering fringe benefits and perks to their employees. Offer your employees these four things to encourage employee fitness, and you might even be able to write-off the expense!
- FRINGE BENEFIT DEDUCTION – The IRS allows you to offer employees fringe benefits in addition to basic pay, and deduct it from your business taxes. Health plans, life insurance and even education assistance are considered fringe benefits. With passage of the 2017 tax act, the individual mandate to purchase health coverage has been eliminated, but employers can still offer employees health-related perks and deduct them as fringe benefits.
- DEDUCT GYM MEMBERSHIPS – Health club or gym memberships are also considered a deductible fringe benefit. If you’re a sole proprietor or single member LLC, then you can deduct gym memberships in the “Expenses” section of Schedule C. If you’re in a partnership or multiple-member LLC, use Form 1065. For Corporations, a gym membership can be expensed as “Deductions” on Form 1120. You may also want to ask your bookkeeper or accountant if you can exclude the value of gym benefits as employee income.
- ON-SITE OFFICE GYM – Did you know that you can write off the cost of setting up and operating a fitness center in your own workplace? To do this, you make it available to all employees. According to a University of Michigan study, companies with a corporate fitness program had less employees, lower insurance costs, improved staff morale, and increased productivity. At Brigade Bookkeeping we have our own gym and every so often, we offer special classes or bring in a masseuse for a little added stress relief.
- BIKING TO WORK – A great way to lose weight is to ride your bike to work. If you live in a community that’s conducive to bike riding, then you could offer your employees transit benefit perks and deduct it from your taxes. In 2017, the IRS allows companies to deduct $20 a month per employee for biking-related expenses. That number remains the same for next year.
As a business owner, there are a lot of ways you can encourage your employees to be healthier and help them with their fitness goals, all while reducing your own taxes and reaping the benefits of a healthier lifestyle. If you have questions about fringe benefit tax laws or how to create your own in-office gym, please call or email me. I’m all about keeping my employees happy and healthy and I want you to do the same.
Here’s to keeping our goals for 2018!