Is a sports-training facility's personal and group training memberships, where members can only access the facility during scheduled sessions, a taxable athletic-club membership?

Plain-English summary

A sports-training facility offers scholastic training (ages 7-18), adult boot camp and strength training, and personal or small-group training in specific sports or methodologies — all led by degreed, certified coaches. Members buy session packs or unlimited-monthly memberships, but critically, membership alone doesn't get you into the building: you can only access the facility during your scheduled personal or group training session. The facility asked whether these memberships were taxable "amusement services" like a typical health-club membership.

The Comptroller ruled they are nonamusement services, not taxable. Texas taxes memberships in athletic clubs, health clubs, and physical fitness centers as amusement services — but it exempts activities that are primarily instructional in nature, including instruction in a sport. The Comptroller has previously distinguished taxable "open gym" memberships (where a fee buys general facility access) from nontaxable personal or group instruction (a program with real coaching content, not just equipment access). Because this facility's members can never just walk in and use equipment on their own — every visit is a scheduled, coach-led session — the memberships fall on the instructional, nontaxable side of the line.

What this means for you

Gym, fitness studio, and sports-training business owners

The taxability of your memberships turns on what the fee actually buys: open facility access (taxable amusement service) versus scheduled, coach-led instruction (nontaxable). If your members can only enter during a specific coached class or session — no open-gym walk-in access — you have a strong case for nontaxable treatment, per this ruling's reasoning.

Personal trainers and specialty class studios (boot camp, sport-specific coaching)

Charging separately for personal or small-group sessions, with real one-on-one or class-format coaching rather than just supervising equipment use, supports nontaxable treatment — consistent with the "Jazzercise-style" group class standard the Comptroller has used since a 1998/2001 line of rulings.

Accountants and tax professionals

This ruling applies the Rule 3.298(a)(1)(D)/(a)(2)(B) instructional-services carve-out and leans on the same STAR precedent (9801164L, 200103848L) and Comptroller's Decision No. 104,707 (2011) that distinguish "open gym" access from coached instruction — a useful checklist for any health/fitness club structuring or restructuring its membership tiers.

Common questions

Q: Are all gym memberships exempt if they include some personal training?
A: No — the key fact here is that members have NO facility access outside their scheduled sessions. A membership that also allows general "open gym" use alongside training sessions would likely be taxable for that open-access component.

Q: What's the difference between a taxable and nontaxable fitness membership under this analysis?
A: Taxable: a membership fee that buys open access to workout on your own. Nontaxable: a fee for scheduled, coach-led personal or group instruction with no separate open-access privilege.

Q: Can my fitness business rely on this ruling directly?
A: No. It's a private letter ruling binding on the Comptroller only for the taxpayer and facts submitted, and it cannot be relied on by any other taxpayer — your membership structure needs its own review if it differs.

Citations and references

Statutes, rules, and decisions:

• Tex. Tax Code § 151.0101(a) ("Taxable Services" — amusement services)
• 34 Tex. Admin. Code Rule 3.298(a)(1)(D) (athletic/health club memberships as amusement services); Rule 3.298(a)(2), (a)(2)(B) (instructional-activity exemption)
• STAR Accession No. 9801164L (Jan. 7, 1998); STAR Accession No. 200103848L (Mar. 23, 2001)
• Comptroller's Decision No. 104,707 (2011)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/201808006L

Original ruling text

August 13, 2018

RE: Private Letter Ruling No. 20180108103435

* Taxpayer No. *

Dear **:

We issue this private letter ruling in accordance with Rule 3.1, Private Letter Rulings and General Information Letters. [ENDNOTE: 1] We are responding to your request dated Dec. 27, 2017. Detrimental reliance relief is provided in accordance with Rule 3.10, Taxpayer Bill of Rights.

You requested guidance on the taxability of certain specialized fitness and sports training memberships.

Facts Presented

** (Taxpayer) provides a variety of fitness and sports training services at its facility in CITY, Texas. Training sessions vary based on a member’s age and fitness goals. Scholastic training sessions are for members 7-18 years old and focus on developing athleticism. Adult training sessions are for members who are at least 18 years old and include boot camp and strength training sessions. Taxpayer also provides personal training or small group training with an instructor in a specific sport or training methodology.

All scholastic and adult training sessions are group sessions led by a degreed and certified coach trained in the methodology of the class. The classes also allow a coach to work with individual members and to accommodate a member’s specific limitations due to health issues or injury.

Taxpayer offers a variety of membership options. A member may purchase a pack of sessions allowing attendance of a certain number of sessions. There are monthly membership options that allow a member to attend an unlimited number of sessions in a month. Taxpayer charges for personal and small group training sessions separately from the membership options. All membership types only allow access to the facility during the scheduled sessions.

Question, Ruling, and Analysis

Our restatement of your question is shown below, followed by our response and analysis.

Question: Are Taxpayer’s fitness and sports training sessions and memberships considered nonamusement services under Rule 3.298(a)(2) (Amusement Services)?

Ruling: Taxpayer’s fitness and sports training sessions and memberships are nonamusement services under Rule 3.298(a)(2).

Analysis:

Section 151.0101(a) (“Taxable Services”) provides a list of taxable services, which includes an amusement service. Rule 3.298 defines and provides examples of amusement services that are subject to sales tax, which include memberships in athletic clubs, health clubs, and physical fitness centers. See Rule 3.298(a)(1)(D). Rule 3.298 also defines and provides examples of nonamusement services that are not subject to sales tax, which include activities that are primarily instructional in nature and instruction in sport or musical discipline. See Rule 3.298(a)(2); (a)(2)(B).

The Comptroller previously addressed the taxability of personal or group training services and “open gym” memberships. See STAR Accession Nos. 9801164L (Jan. 7, 1998) and 200103848L (March 23, 2001). See also Comptroller Decision No. 104,707 (2011). Personal training services provided for a separately stated charge, flat fee, or under a contract are not taxable as an amusement service if the service involves personal one-on-one training and the client goes through a program that is not just instructions on equipment use. Group training services are not taxable if the training has a class format similar to Jazzercise sessions. The Comptroller also clarified that a membership or admission fee that allows for open use of the gym is subject to sales tax under Rule 3.298(a)(1). See STAR Accession Nos.9801164L (Jan. 7, 1998) and 200103848L (March 23, 2001). See also Comptroller Decision No. 104,707 (2011).

Taxpayer provides personal and group training in its fitness and sports training services and membership options. Taxpayer charges members for its personal training services per session. Each session includes one-on-one training with an instructor and follows a program designed for a specific type of sport or training methodology. A trained instructor leads the group training sessions, which are also available in a class format.

Members cannot access the facility without attending a scheduled personal or group training session. Taxpayer’s fitness and sports training services and memberships are nonamusement services that are not subject to sales tax. See STAR Accession Nos. 9801164L (Jan. 7, 1998) and 200103848L (March 23, 2001). See also Comptroller Decision No. 104,707 (2011).

Comptroller’s Decisions and STAR documents cited can be found on the Comptroller’s State Tax Automated Research (STAR) system. The Texas Tax Code, Texas Administrative Code, and the STAR system are accessible at www.comptroller.texas.gov/taxes/.

If you have questions about this private letter ruling, please email us through our website at https://comptroller.texas.gov/web-forms/tax-help/ and reference Private Letter Ruling No. 20180108103435.

Sincerely,

Tax Policy Division – Indirect Taxes

Texas Comptroller of Public Accounts

ENDNOTE:

1. Unless otherwise indicated, all references to “Section” are to the Texas Tax Code, and all references to “Rule” are to Title 34 of the Texas Administrative Code.