Taxation of Fringe Benefits for S-Corp Owner?

[Michael in ABQ]

I own an S-Corp with my wife. We have a single local part-time employee that generally works from home (plus our kids working a few hours here and there).

I recently started going to a Crossfit gym just down the street from my office. I'm wondering how it will work if I run this expense through the business. Would this be considered a fringe benefit, or would I need to offer it to our employee as well - who wouldn't take advantage of it since she lives 30 miles away.


I read through some IRS documents, and it looks like it would be considered taxable income. I pay myself a fairly modest W-2 salary as any profits are just being reinvested in the business. So, adding $1,500 a year to my taxable income wouldn't be a big deal and if that also added a $1,500 deduction it seems like it would basically balance out. Am I looking at this the right way or is there something I'm missing?

[ixtap]

I just came to say I read this as "fridge benefits."

[sonofsven]

Is that really a business expense?

[Michael in ABQ]

Is that really a business expense?

Potentially. I know some businesses offer to pay for gym memberships and a lot of other fringe benefits. I wasn't sure how exactly the rules differ for small businesses and owners.

[SeattleCPA]

This page lists the fringe benefits that may be excludable and then points out when S corp shareholder-employees aren't eligible:

https://www.irs.gov/publications/p15b

BTW the usual case is, S corp shareholder-employees don't get a tax-free fringe benefit.