January 23, 2006
IRS Denies Medical Expense Deduction for Costs of Gender-Reassignment Surgery
The IRS has ruled in Chief Counsel Advice 200603025 that male-to-female gender reassignment surgery does not qualify as a deductible medical expense under § 213:
On the taxpayer’s Year 6 return, the taxpayer reported medical and dental expenses for an amount exceeding $___.... The expenses included payments for various doctors, prescriptions, health insurance, transportation and lodging in connection with the taxpayer’s gender reassignment surgery (GRS). In a report dated July 2, Year 8, the Revenue Agent disallowed the expenses on the ground that they were for cosmetic surgery and nondeductible pursuant to § 213(d)(9).
§ 213(d)(9)(A) provides that the term “medical care” does not include cosmetic surgery or other similar procedures, unless the surgery or procedure is necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease. § 213 (d)(9)(B) defines “cosmetic surgery” as any procedure that is directed at improving the patient’s appearance and does not meaningfully promote the proper function of the body or treat illness or disease....
Whether gender reassignment surgery is a treatment for an illness or disease is controversial....To our knowledge, there is no case law, regulation, or revenue ruling that specifically addresses medical expense deductions for GRS or similar procedures. In light of the Congressional emphasis on denying a deduction for procedures relating to appearance in all but a few circumstances and the controversy surrounding whether GRS is a treatment for an illness or disease, the materials submitted do not support a deduction. Only an unequivocal expression of Congressional intent that expenses of this type qualify under section 213 would justify the allowance of the deduction in this case. Otherwise, it would seem we would be moving beyond the generally accepted boundaries that define this type of deduction.
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I'm really surprised that the CCA cited "First Things" a religious journal.
Posted by: David Shulman | Jan 23, 2006 10:56:45 PM
There is California case law on point that specifically states it is NOT cosmetic surgery and that it is medically necessary surgery. This is easily appealable according to a california transgender law expert and attorney.
Posted by: Dianne Bishop | Jan 24, 2006 1:25:46 AM
Certainly it is controversial that GRS corrects an illness. But, I think it's worth exploring the boundaries of that controversy. Would an argument that a mismatch between the body's apparent sex and the brain's apparent sex signify a congential abnormality? I submit that one could argue thus and not be wrong. I also think that, given the current understanding of transgender issues (and intersex issues) and the current state of tax law, I would not hesitate to argue that such surgeries do meaningfully promote the proper functioning of the body and potentially correct a disease listed in the DSM IV (Gender Identity Disorder). We can argue whether that should or should not be there, but given that it is, how can the IRS then say that accepted medical practice to treat such "illness" is disallowed? I certainly hope it gets appealed.
Posted by: Denise | Jan 31, 2006 7:02:29 PM
This blog is slightly out of the ordinary, but I feel is very appropriate for consideration.
Anyone that has a pet knows what a huge part of the family that pet becomes. The costs to raise and maintain the pet are considerable. The cost often gets larger the older the pet becomes. Medical costs can be huge.
Let's start a movement with the politicians that will make it possible to claim at least those items in the care of pets that can be verified for IRS. This may sound radical but if you have a pet and it costs more than most other dependents in your family, you will support this. Any help out there?
Posted by: Ron | Feb 11, 2006 5:06:29 PM
My dog medical bills were higher than my childs for the year of 2005. Our pet had to have surgery and was treated by a License Veternarian Physician. They bill us for their medical services provided for our pets as any Doctor teating a human being. They have to file with the IRS for services provided just like any human treating Doctor what is the difference? We should be able to claim our medical expences. I believe that IRS should make allowances for claiming our pets high medical cost also.
Posted by: Rose M. Holliday | Mar 19, 2006 3:44:45 PM
My Pets medical bills were higher than my child’s for the year of 2006. My dog has being part of my family for over 14 yrs. She was diagnosed with cancer and required three surgeries plus antibiotics after each surgery. She was treated by a License Veterinarian Physician. The healthcare provided was listed has income for that Veterinarian clinic; why can't we count at least a fourth of our expenses in our tax deduction as we do with our dependants?
I also agreed that IRS should make allowances for claiming our pets high medical cost.
Posted by: Pedro AK | Jan 12, 2007 1:40:08 PM
"unless the surgery or procedure is necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease."
Feed a genetically born woman testosterone and then tell us if she considers the result "a disfiguring disease". To be born disgured this way is as bad as it gets. Suicide, drugs ,alcoholism, self destruction are often the result of it . No treatment to eliviate the suffering that comes from this is "cosmetic". The IRS often quote from the anti-transsexual teachings in a Catholic religious journal by Paul McHugh is an influential conservative Catholic ideologue/bigot "who for some odd reason has been on a lifelong rampage to "stop sex changes" ". He vowed to do so in 1979 when he took over Johns Hopkins and did.
Now whats odd about this are the deductions given to mentally ill Christ followers who claim to see an invisible god. Apparently if you are delusional enough to believe there is a god you get to write off everything. It's time to end Christianity. It has become the most dangerous religion in the world and is filled with obviously sick people.
Posted by: Darlie | Jul 21, 2007 3:49:11 AM