Can You Put a Gym Membership on an HSA?
Can your gym membership be covered by an HSA? Learn the specific medical necessity rules and documentation required for eligibility.
A Health Savings Account (HSA) provides a tax-advantaged way to save and pay for qualified medical expenses. These accounts offer a triple tax benefit: contributions are tax-deductible, earnings grow tax-free, and withdrawals for eligible expenses are also tax-free. However, determining which expenses qualify for HSA funds can sometimes be complex, especially for services like gym memberships. Adhering to Internal Revenue Service (IRS) guidelines is crucial to avoid tax penalties.
General Eligibility for HSA Funds
The Internal Revenue Service (IRS) defines a “qualified medical expense” as costs for diagnosis, cure, mitigation, treatment, or prevention of disease, or for affecting any part or function of the body. These expenses must primarily alleviate or prevent a physical or mental disability or illness. Generally, common eligible expenses include medical, dental, and vision care, as well as prescription medications.
Expenses merely beneficial to general health, without a specific medical purpose, are not considered qualified medical expenses. This includes costs for general health improvement, cosmetic procedures, or items not directly tied to a diagnosed condition. The IRS details these guidelines in publications like IRS Publication 502. Funds withdrawn from an HSA for non-qualified expenses before age 65 are subject to income tax and a 20% penalty.
Specific Conditions for Gym Memberships
A gym membership is generally not considered a qualified medical expense by the IRS, as it’s typically viewed as a personal expense for general health. However, a gym membership can become an eligible HSA expense under precise circumstances. This requires a clear demonstration of medical necessity, meaning the membership is part of a treatment plan for a specific medical condition.
To qualify, a healthcare provider must diagnose a specific medical condition, such as obesity, heart disease, diabetes, or certain mental health conditions like depression or anxiety, where exercise is a direct treatment component. The provider must then issue a Letter of Medical Necessity (LOMN) or a prescription. This document should explicitly state the diagnosed condition and explain how the gym membership is medically necessary for its treatment, mitigation, or prevention. The LOMN should detail the specific activity recommended and its duration. Without this direct medical link and proper documentation, a gym membership for general fitness or weight loss remains a non-qualified expense.
For instance, if a doctor prescribes regular cardiovascular exercise to manage high blood pressure, a written recommendation for a gym membership could make it eligible for reimbursement. The membership must be directly tied to the treatment plan. Some weight-loss programs with a medical component, prescribed by a physician for a specific disease, may also qualify. However, general gym membership dues are usually excluded unless directly linked to a diagnosed condition.
Documentation and Reimbursement
When using HSA funds for any qualified medical expense, including a gym membership under specific conditions, meticulous record-keeping is essential. You must retain thorough documentation, including receipts for all gym membership payments and the original Letter of Medical Necessity or doctor’s prescription. These records are crucial for tax purposes and in case of an IRS audit, as you are responsible for proving that distributions from your HSA were for qualified medical expenses.
You do not typically need to submit these records to your HSA administrator for reimbursement, but you must keep them with your tax records. Reimbursement usually involves logging into your HSA account online, entering expense details, and selecting a method such as an electronic transfer to a linked bank account or a check. Many HSA providers offer a debit card for direct payment of qualified expenses. There is generally no time limit to request reimbursement for qualified medical expenses, provided the expense was incurred after the HSA was established and not reimbursed from another source or taken as an itemized tax deduction.