Opening a studio in Indiana: the $25,000 presale bond and the bold-type contract

October 14, 2026

This is for anyone opening a Pilates, yoga, barre or boutique fitness studio in Indiana. Indiana's Health Spa Services Act has no registration and no bond for a studio that is already open. It has two rules that change how you sell. Signing members before you open takes a $25,000 surety bond filed with the Secretary of State. And every member contract carries its cancel terms in at least 10-point bold type.

The Health Spa Services Act reaches class studios

The Act is IC 24-5-7. It defines health spa services as “instruction, training, or assistance in physical culture, bodybuilding, exercising, reducing, figure development, or any other health spa service.” A health spa is any business offering them to the public, “other than an entity that is exempt from taxation under Section 501 of the Internal Revenue Code.”

That nonprofit line is the only way out. There is no carve-out for yoga, Pilates, dance or class-only studios, and no minimum price or term. A for-profit class studio reads to us as covered. The chapter has no registration, certificate or fee for a studio that is open. What it has is contract rules, plus a bond if you sell before you open.

What every member contract must say

• In writing, with a copy to the member when it is formed, plus a written copy of their cancel rights (24-5-7-2, 24-5-7-5).
• In at least 10-point boldface: the member may cancel before midnight of the third full business day after signing. Sundays and legal holidays do not count. Notice is written, delivered in person or by certified or registered mail, with any membership cards. You refund all of it within 30 days (24-5-7-5).
• Also in 10-point bold: the member or their estate may cancel on death, total physical disability for the rest of the contract, the studio moving more than five miles, or a permanent closure (24-5-7-6). You may keep the value of services used plus expenses up to 25% of the contract price (24-5-7-8).
• In 10-point bold: any credit or loan agreement for it is canceled too (24-5-7-8).
• No term over three years, no payments past 36 months, no lifetime memberships. Renewals must be priced at $24 a year or more (24-5-7-3).
• At an open studio, services start within 45 days of signing (24-5-7-4).

Moving away is not on the list, as the Attorney General's fact sheet for members points out. If a facility or service in the contract stops, the member gets a pro-rata refund or can finish at another location you run (24-5-7-16.5). If you sell the studio, the buyer takes on every membership contract (24-5-7-16). A member cannot waive any of this (24-5-7-12).

A contract that misses these terms is voidable by the member. You get a chance to fix it: after written notice you have 30 days to tell every member, and you must bring every contract into line (24-5-7-10). A violation is also a deceptive act under the Deceptive Consumer Sales Act, where a member relying on an uncured violation recovers actual damages or $500, whichever is greater (24-5-7-17).

The chapter sets no minimum term or price, and we found no guidance on whether a single drop-in or a five-class pack is a “contract for health spa services.” We would put the bold notices in the written terms for every membership and every pack.

Founding members and the $25,000 bond

Section 13 is the presale rule. A health spa “that sells contracts for health spa services to be rendered at a planned health spa facility or a health spa facility under construction” files a $25,000 bond with the Secretary of State, from a surety admitted in Indiana. The Secretary may set more by rule; we found no rule that does. The bond guarantees that you build or open the studio (24-5-7-14), and it ends “upon commencing health spa service.”

The trigger is selling the contract, not taking the money. In Frontmat a membership can be sold before opening with billing starting on opening day, so a founding member pays nothing until the doors open. We still read that as selling a contract for a planned facility. If you sign founding members before you open, plan on the bond. A presale contract is also voidable by the member if you are not open within 12 months of signing (24-5-7-4).

What that means for your products

In Frontmat, memberships bill monthly through Stripe on the member's card. Class packs can expire after a number of days you set, or never. In Indiana we would set an expiry on every pack.

The AED law names studios

Indiana's defibrillator law (IC 24-4-15) applies to a “health club,” and its definition lists “Health spas and studios.” It applies once at least 50 people have bought or paid a fee for “the right to use the physical fitness facilities,” or once you have 30 pieces of motorized equipment. We read a cycling or HIIT studio as squarely in. We read a Pilates or yoga studio with 50 paying members as in too.

A covered studio keeps an AED on the premises within easy reach. It employs at least one person currently certified in CPR and AED use and reasonably ensures one is there whenever staff are. It posts a sign at each entrance showing where the AED is. A violation is a Class C infraction. Whoever has an AED also tells the local ambulance service and registers it with the Department of Homeland Security (IC 16-31-6.5-5).

Sales tax: classes and memberships look untaxed

Indiana's sales tax is 7%. It reaches goods and a list of services the statute names. The Department of Revenue says “Generally, transactions involving services are not taxable retail transactions.” Nothing in the sales tax chapter names fitness, recreation or admissions, so we read classes, packs and memberships as untaxed. We found no ruling on fitness studios specifically. Grip socks and mats are taxable at 7%.

Frontmat does not add a sales tax line to packs or memberships, which fits that reading.

Your waiver

Indiana enforces a release of your own negligence. In Powell v. American Health Fitness Center of Fort Wayne (Ind. Ct. App. 1998), the court repeated that “it is not against public policy to enter an agreement which exculpates one from the consequences of his own negligence” where no statute says otherwise. The club still lost. Its release covered “any and all claims” from the member's use of the club, but “Nowhere does the clause specifically or explicitly refer to the negligence of American Health.” An Indiana waiver should name your studio and use the word negligence.

Indiana's Court of Appeals has upheld a parent's signature. In Wabash County YMCA v. Thompson (Ind. Ct. App. 2012), a mother signed a youth softball league's form for her daughter. The court rejected the argument that a parent's release needs court approval, saying that rule covers settlements after an injury, and held “the release form is valid.” Its reasoning was short: the daughter had pointed to no other authority against the form. Because the form did not mention negligence, it covered only a risk inherent in the game, which sliding into second base was. That was a youth league on a YMCA field, not a paid studio, and the Indiana Supreme Court has not ruled. In Sauter v. Perfect North Slopes (S.D. Ind. 2014), a federal court applying Indiana law called this a question “on which the Indiana Supreme Court has not spoken,” and it refused to enforce a snow tubing release a mother signed because the form was unclear about whether it covered her children's claims. In Larky v. Camp Livingston (Ind. Ct. App. 2025), a camp's online release signed by a mother failed because it did not “specifically and explicitly” release the camp from its own negligence. The court did not decide whether her signature bound the father. The Indiana Supreme Court agreed in August 2025 to hear that case, and under the court's rules that automatically vacated the Court of Appeals opinion. As of October 15, 2026, the Supreme Court had published no decision in Larky, and the oral argument it had set for November 2025 was canceled. If you teach teens, have your lawyer write the parent's release so it names your negligence and the child's claims, and ask what became of Larky.

In Frontmat the waiver is your own text. Members sign it once, at their first booking, with a typed name. We store the time and a fingerprint of the exact wording they signed, so a later edit never changes what an earlier member agreed to. It is plain text, so emphasis is done in CAPITALS. We never supply waiver language. Get yours from an Indiana lawyer.

Workers' comp and texts

Indiana's Worker's Compensation Act binds “Every employer and every employee.” The exempt workers are casual laborers, farm and household employees and one narrow nonprofit coaching case. There is no small-employer exemption, so your first employee needs coverage (IC 22-3-2-2, 22-3-2-9, 22-3-5-1). Failing to insure is a Class A misdemeanor (22-3-4-13). A 1099 instructor is an independent contractor if the IRS guidelines say so. If you hire one who is not covered, you “must secure a copy of a stamped certificate of exemption” from them (22-3-2-14.5).

Indiana's Do Not Call law counts a text message as a telephone sales call (IC 24-4.7-2-9), and you may not send one to a number on the state's list. The exemptions a studio can use are a message at the person's express request and one tied to an existing, uncompleted contract (24-4.7-1-1). There is no general exemption for existing customers. The Attorney General's penalty is up to $10,000 for the first violation and $25,000 for each one after, each call counted separately (24-4.7-5-2). The list costs $750 a year.

Frontmat sends booking texts only (waitlist offers, confirmations and cancellations) to members who opted in, and stores the time and wording of each opt-in. It sends no marketing texts.

Before you sign anything

1. Decide whether you will sell before you open. If so, file a $25,000 bond from an Indiana-admitted surety with the Secretary of State before the first founding member signs.
2. Have an Indiana lawyer write the member contract: the three-day cancel, the death, disability, relocation and closure terms and the loan notice in 10-point bold, a term of three years or less, renewals at $24 a year or more.
3. Give every member those terms in writing at signing, for packs as well as memberships.
4. Set every class pack to expire within three years.
5. Have the lawyer write the waiver with your studio's name and the word negligence.
6. Buy and register an AED, tell the ambulance service, certify a staff member and post the signs.
7. Insure your first employee and collect a stamped exemption certificate from each 1099 instructor.

This is our reading of the Indiana Code and the state agency pages as of October 14, 2026. It is not legal advice. Confirm the Health Spa Act questions with the Attorney General's Consumer Protection Division and the bond with the Secretary of State.

If you are still choosing where to open, we keep the rules in every state on one page.