Club Memberships



Employees in certain positions are authorized by POL 05.15.03 for Non-Salary and Deferred Compensation to receive club memberships for the purpose of conducting university business.

Institution-affiliated Clubs – Individual Membership.  Membership to the NC State University Club (University Club) or the NC State Alumni Club, Inc. (State Club) may be authorized for certain positions.  Personal use of individual memberships is taxable.

Institution-affiliated Clubs – Departmental Membership.  Pending approval by the Provost (for Colleges, Student Affairs and Provost Units) or the Vice Chancellor for Finance and Business (for all other administrative units), the NC State University Club (University Club) and the NC State Alumni Club, Inc. (State Club) may issue a “departmental” membership in the department head’s name, for business-only use; personal use of a departmental membership is prohibited.  See 3D memorandum, Procedures for departmental memberships at Institution-Affiliated Clubs, issued on February 21, 2011, for additional information.

External Clubs.  External club memberships are more restrictive regarding position eligibility; they are unable to offer departmental memberships.

Other Memberships.  POL 05.15.3 makes provisions for membership or access to Carmichael Complex or Athletics facilities for certain EHRA employees.   All other memberships to social clubs or a health club/fitness facility must be authorized in advance on a case-by-case basis by the Board of Trustees.  The Non-Salary Compensation Form must be completed, approved and submitted prior to payment.  The memberships are for job-related purposes; any personal use is taxable.

Taxation of Payment

Any personal use of an authorized club membership is considered taxable income and included in the taxable grosses for social security, Medicare, federal, and state tax reporting.  Social security (OASDI) and Medicare taxes (Fed-Med) are withheld on the paycheck.  Per IRS regulations, all use is deemed to be personal and thus, taxable, unless all use is documented (see documentation specifications below) and submitted to University Payroll, clearly identifying the business/job-related use.

Responsible People

Employee: On a monthly or quarterly basis, the employee must submit written documentation to their department to denote all instances of use. All use will be treated as personal if the documentation is missing or incomplete. The documentation must include the following information:

  • Date & time of visit
  • Business purpose
  • Participants(s) – club member (or designee) and guests
  • Relationship to participant(s)

EXCEPTION: EHRA professionals or faculty whose primary role is the physical education instruction or training of students/athletes in the university’s designated facilities, are not required to submit written documentation to prove business use.

College or Department:  On a monthly or quarterly basis (or immediately, if employee terminates), submit to University Payroll the substantiated business documentation for all uses of the membership.  Departments may submit the individual reports provided by the employee; however, if the membership is used frequently, may compile the individual reports onto a single spreadsheet for submission.   Items that do not substantiate a business purpose; or, missing/incomplete documentation will be treated as personal use and thus, taxable.

University Controller’s Office:  Club membership dues or reimbursements will not be processed for individuals unless authorized by this policy or approved as an exception by the Board of Trustees.  A copy of the approved Non-Salary Compensation form should be submitted to support the entry in the Financials System, if the payment is for an exception.

University Payroll:  Based upon the documentation submitted by the department, University Payroll will determine what portion, if any, is reportable and taxable.  Personal use will be calculated as follows:

  • Determine the percentage of personal use by dividing the number of personal uses by the total number of uses for the reporting period,
    Multiply the reporting period’s club dues by the personal percentage to identify the taxable portion,
  • Enter the taxable portion into the HR System using the appropriate earnings code:
    • CM1 ClubMbrNCSU – NCSU-Affilliated Club Membership
    • CM2 ClubMbrNon-NCSU – External Club Membership