[Congressional Record Volume 157, Number 147 (Tuesday, October 4, 2011)]
[Senate]
[Pages S6091-S6092]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Mr. CORNYN (for himself and Mr. Harkin):
S. 1644. A bill to amend the Internal Revenue Code of 1986 to expand
workplace health incentives by equalizing the tax consequences of
employee athletic facility use; to the Committee on Finance.
Mr. CORNYN. Mr. President, I rise to introduce the Workforce Health
Improvement Program Act of 2011, otherwise known as the WHIP Act. I am
very pleased to be joined again by my good friend and colleague,
Senator Tom Harkin, who shares my commitment to helping keep America
fit.
Public health experts unanimously agree that people who maintain
active and healthy lifestyles dramatically reduce their risk of
contracting chronic diseases. And as the government works to reign in
the high cost of health care, it is worth talking about what we all can
do to help ourselves. As you know, prevention is key, and exercise is a
primary component in the prevention of many adverse health conditions
that can arise over one's lifetime. A physically fit population helps
to decrease health-care costs, reduce governmental spending, reduce
illnesses, and improve worker productivity.
According to the Centers for Disease Control and Prevention, CDC, the
economic cost alone to businesses in the form of health insurance and
absenteeism is more that $15 billion. Additionally, the CDC estimates
that more than one-third of all U.S. adults fail to meet minimum
recommendations for aerobic physical activity. With physical inactivity
being a key contributing factor to overweight and obesity, and
adversely affecting workforce productivity, we quite simply need to do
more to help employers encourage exercise.
Given the tremendous benefits exercise provides, I believe Congress
has a duty to create as many incentives as possible to get Americans
off the couch, up, and moving.
With this in mind, I am reintroducing the WHIP Act.
Current law already permits businesses to deduct the cost of on-site
workout facilities, which are provided for the benefit of employees on
a pre-tax basis. But if a business wants or needs to outsource these
health benefits, they and/or their employees are required to bear the
full cost. In other words, employees who receive off-site fitness
center subsidies are required to pay income tax on the benefits, and
their employers bear the associated administrative costs of complying
with the IRS rules.
The WHIP Act would correct this inequity in the tax code to the
benefit of many smaller businesses and their employees. Specifically,
it would provide an employer's right to deduct up to $900 of the cost
of providing health club benefits off-site for their employees. In
addition, the employer's contribution to the cost of the health club
fees would not be taxable income for employees--creating an incentive
for more employers to contribute to the health and welfare of their
employees.
The WHIP Act is an important step in reversing the largely
preventable
[[Page S6092]]
health crisis that our country is facing, through the promotion of
physical activity and disease prevention. It is a critical component of
America's health care policy: prevention. It will improve our nation's
quality of life by promoting physical activity and preventing disease.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 1644
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Workforce Health Improvement
Program Act of 2011''.
SEC. 2. EMPLOYER-PROVIDED OFF-PREMISES HEALTH CLUB SERVICES.
(a) Treatment as Fringe Benefit.--Subparagraph (A) of
section 132(j)(4) of the Internal Revenue Code of 1986
(relating to on-premises gyms and other athletic facilities)
is amended to read as follows:
``(A) In general.--Gross income shall not include--
``(i) the value of any on-premises athletic facility
provided by an employer to its employees, and
``(ii) so much of the fees, dues, or membership expenses
paid by an employer to an athletic or fitness facility
described in subparagraph (C) on behalf of its employees as
does not exceed $900 per employee per year.''.
(b) Athletic Facilities Described.--Paragraph (4) of
section 132(j) of the Internal Revenue Code of 1986 (relating
to special rules) is amended by adding at the end the
following new subparagraph:
``(C) Certain athletic or fitness facilities described.--
For purposes of subparagraph (A)(ii), an athletic or fitness
facility described in this subparagraph is a facility--
``(i) which provides instruction in a program of physical
exercise, offers facilities for the preservation,
maintenance, encouragement, or development of physical
fitness, or is the site of such a program of a State or local
government,
``(ii) which is not a private club owned and operated by
its members,
``(iii) which does not offer golf, hunting, sailing, or
riding facilities,
``(iv) whose health or fitness facility is not incidental
to its overall function and purpose, and
``(v) which is fully compliant with the State of
jurisdiction and Federal anti-discrimination laws.''.
(c) Exclusion Applies to Highly Compensated Employees Only
if No Discrimination.--Section 132(j)(1) of the Internal
Revenue Code of 1986 is amended--
(1) by striking ``Paragraphs (1) and (2) of subsection
(a)'' and inserting ``Subsections (a)(1), (a)(2), and
(j)(4)'', and
(2) by striking the heading thereof through ``(2) apply''
and inserting ``Certain exclusions apply''.
(d) Employer Deduction for Dues to Certain Athletic
Facilities.--
(1) In general.--Paragraph (3) of section 274(a) of the
Internal Revenue Code of 1986 (relating to denial of
deduction for club dues) is amended by adding at the end the
following new sentence: ``The preceding sentence shall not
apply to so much of the fees, dues, or membership expenses
paid to athletic or fitness facilities (within the meaning of
section 132(j)(4)(C)) as does not exceed $900 per employee
per year.''.
(2) Conforming amendment.--The last sentence of section
274(e)(4) of such Code is amended by inserting ``the first
sentence of'' before ``subsection (a)(3)''.
(e) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.
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