Can I Pay for My Gym Membership With My HSA?

A Health Savings Account (HSA) is a tax-advantaged savings account designed to help individuals manage healthcare expenses. It is typically paired with a high-deductible health plan (HDHP), allowing participants to save and pay for qualified medical expenses on a pre-tax basis. Contributions to an HSA are tax-deductible, any earnings grow tax-free, and withdrawals are tax-free when used for eligible medical costs. Unlike some other health savings vehicles, HSA funds roll over from year to year, accumulating savings for both immediate and future healthcare needs.

Understanding Gym Memberships and HSA Eligibility

The Internal Revenue Service (IRS) defines qualified medical expenses as amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for affecting any structure or function of the body, as outlined in Internal Revenue Code Section 213. Generally, routine gym memberships, fitness classes, and other general health activities are not considered qualified medical expenses. The rationale for this exclusion is that these activities are typically for general health and wellness, not for the treatment or prevention of a specific medical condition. The IRS views such expenses as personal or recreational, and they do not qualify as medical treatment unless a specific medical necessity is established.

Conditions for HSA-Eligible Gym Expenses

A gym membership can become an HSA-eligible expense if a medical professional, such as a physician or physician assistant, prescribes it as part of a treatment plan for a diagnosed medical condition or disease. For example, exercise might be prescribed for conditions like obesity, heart disease, diabetes, hypertension, or certain mental health conditions such as depression or anxiety.

A Letter of Medical Necessity (LMN) or a doctor’s prescription is required to prove this medical necessity. This document must clearly state the specific medical condition being treated and explain how the gym membership directly alleviates or prevents that condition. The LMN should provide a clear clinical rationale, often including medical codes related to the diagnosis, and is valid for about 12 months, after which a new one may be needed if treatment continues.

Navigating Reimbursement for Approved Expenses

Once you have the necessary medical prescription or Letter of Medical Necessity (LMN), you can use your HSA funds for the gym membership. It is important to keep thorough records of all related expenses, including the doctor’s note or LMN and detailed receipts for gym membership payments. These documents are essential for substantiating the eligibility of your expenses, especially in the event of an IRS audit. Records should be retained for at least seven years, or as long as your HSA remains open, whichever period is longer.

You can pay for the gym membership directly from your HSA using a dedicated debit card, or pay out-of-pocket and reimburse yourself later. The IRS allows for reimbursement years after an expense was incurred, provided it was a qualified expense at the time and occurred after your HSA was established. Your HSA provider will issue Form 1099-SA for distributions, which you will report on IRS Form 8889 when filing your annual taxes.