Can You Use a Flexible Spending Account for a Gym Membership?
Discover if your gym membership qualifies for Flexible Spending Account reimbursement. Learn the specific medical conditions and documentation needed.
Flexible Spending Accounts (FSAs) offer a way to manage healthcare costs. These employer-sponsored benefits allow individuals to set aside pre-tax salary for qualified medical expenses. Contributions are not subject to federal income tax, Social Security tax, or Medicare tax, which can lead to significant tax savings.
Understanding Eligible FSA Expenses
The Internal Revenue Service (IRS) defines eligible FSA expenses. These include costs for diagnosis, treatment, or prevention of disease, or for affecting any structure or function of the body. Common eligible expenses encompass medical, dental, and vision care, such as prescription medications, co-pays, deductibles, eyeglasses, and dental treatments. FSAs operate under a “use-it-or-lose-it” rule, meaning funds not used by the end of the plan year are typically forfeited. However, employers may offer a grace period or a limited carryover amount.
Conditions for Gym Membership Coverage
Gym memberships are not considered eligible FSA expenses for general health improvement or prevention. However, they can qualify if they meet specific “medical necessity” criteria as defined by the IRS. This means the gym membership must be prescribed by a physician to treat a specific diagnosed medical condition, such as obesity, hypertension, heart disease, or for physical therapy.
To substantiate this medical necessity, a Letter of Medical Necessity (LMN) from a licensed healthcare provider is required. The LMN must clearly state the diagnosed condition, explain how the gym membership will treat or alleviate that condition, and specify the duration for which it is prescribed. The expense must be for treatment and not merely for general well-being.
Submitting for Reimbursement
Once the conditions for eligibility are met and the necessary documentation is obtained, individuals can submit a claim for reimbursement to their FSA administrator. The required documentation for a gym membership claim includes the physician’s Letter of Medical Necessity and itemized receipts from the gym. These receipts must detail the date(s) of service, the type of service, the dollar amount, and the provider’s name.
Claims can be submitted through online portals, mobile applications, fax, or mail. It is advisable to submit claims regularly, such as monthly, to manage available funds. After submission, claims are processed within a few business days, with reimbursement sent via direct deposit. Retain copies of all submitted documentation for personal records, as administrators may request additional information or the IRS may audit.