UNIVERSITY OF VIRGINIA
           FINANCIAL AND ADMINISTRATIVE POLICIES MANUAL



TITLE:  PAYROLL:  COMPLIMENTARY BENEFITS           POLICY:  XII.E.2x
                                          
         
GENERAL

The University of Virginia complies with IRS guidelines as they
relate to taxing complimentary benefits provided by Intramural-
Recreation Sports of the Athletic Department.  All faculty, staff,
and students receiving the benefits mentioned below need to be
aware of the potential tax consequences of such benefits.


COMPLIMENTARY MEMBERSHIPS

Taxability of complimentary memberships is dependent on the type of
individual receiving the benefit, as specified below:

      INTRAMURAL-RECREATIONAL SPORTS STAFF INCLUDING STUDENT
      EMPLOYEES:  Such memberships are nontaxable working condition
      fringe benefits.  Staff members need to have access to the
      facilities to properly perform their duties.  After hours use
      is important for quality control and feed back as a customer.

      PHYSICAL EDUCATION STAFF:  Complimentary memberships are a
      nontaxable working condition fringe benefit.  Staff members
      must have access to the facilities in order to conduct their
      professional duties.

      ATHLETIC DEPARTMENT STAFF- COACHES: Complimentary memberships
      are a nontaxable working condition fringe benefit.  For some
      sports, the teams practice exclusively in these facilities. 
      Other teams practice or train in these facilities when their
      usual practice facilities are unavailable.  Therefore,
      coaches must have access to these facilities.

      ATHLETIC DEPARTMENT STAFF- SUPPORT:  Complimentary
      memberships are a taxable fringe benefit.  Facilities are not
      primarily for the purpose of employees, nor are the
      facilities available on a complimentary basis to most
      employees outside the Athletic Department.  

      UNIVERSITY POLICE:  Complimentary memberships are a
      nontaxable working condition fringe benefit.  The Police
      Department strongly encourages members of the police force to
      use the University's recreational facilities.  It is
      essential to their duties that police officers remain in good
      physical condition. 

COMPLIMENTARY MEMBERSHIPS, CONT'D

      INTRAMURAL-RECREATION SPORTS ADVISORY BOARD:  Complimentary
      memberships are a nontaxable working condition fringe
      benefit.  It is appropriate that Advisory Board members
      receive complimentary memberships because it is essential to
      their board duties that they have access to the facilities.

      VICE PRESIDENTS AND OTHER HIGH RANKING EMPLOYEES: 
      Complimentary memberships are a taxable fringe benefit.  Use
      of such facilities is not considered essential to their
      duties.

      SPOUSES OF EMPLOYEES:  Complimentary memberships are a
      taxable fringe benefit to the employee.

      NON-EMPLOYEES:  Complimentary memberships are not nontaxable,
      if the membership for a non-employee promotes good will and
      is for a short duration.  


COMPLIMENTARY OR REDUCED TUITION CLASSES

      INTRAMURAL-RECREATION SPORTS STAFF INCLUDING STUDENT
      EMPLOYEES:  Complimentary classes are "no-additional-cost"
      services and, therefore, are nontaxable.  Participation is on
      a space-available basis only and ; no paying students are
      prevented from enrolling.  Staff members provide valuable
      feed back for quality control.  The de-minimis rule also
      applies in this case, since the cost of these courses is
      usually less than $25.

      SPOUSES/FAMILIES OF ATHLETIC DEPARTMENT EMPLOYEES: 
      Complimentary classes are considered taxable fringe benefits
      to the employees if their spouse or family members receive
      free or reduced tuition for such classes.  

                                                                   
ISSUED BY:                                                 08/19/94

Assistant Comptroller for
Accounting Operations          12.5.2.1