US Tax Court Rules GID Expenses Deductible

Posted by – February 2, 2010

From TaxProf Blog:

In a long-awaited decision, a fractured (8-5-3) Tax Court today ruled in O’Donnabhain v. Commissioner, 134 T.C. No. 4 (Feb. 2, 2010), that male-to-female gender reassignment surgery qualifies as a deductible medical expense under § 213, reversing the IRS’s position in Chief Counsel Advice 200603025.  The 8-judge majority held that:

  • TP’s gender identity disorder is a “disease” within the meaning of  § 213(d)(1)(A) & (9)(B).
  • TP’s hormone therapy and sex reassignment surgery were for the treatment of disease within the meaning of  § 213(d)(1)(A) & (9)(B), and thus not “cosmetic surgery” excluded from the definition of deductible “medical care” by § 213(d)(9)(A).
  • TP’s breast augmentation surgery was directed at improving her appearance did not meaningfully promote the proper function of her body or treat disease within the meaning of § 213(d)(9)(B), and thus was “cosmetic surgery” excluded from the definition of deductible “medical care” by § 213(d)(9)(A).

Judge Gale wrote the 69-page majority opinion, joined by Judges Cohen, Colvin. Marvel, Morrison, Paris, Thornton, and Wherry.  Judge Halperin (12 pages), Judge Holmes (joined by Judge Goeke) (23 pages), and Judge Goeke (joined by Judge Holmes) (6 pages) wrote separate concurring opinions.  Judge Foley (joined by Judges Gustafson, Kroupa, Vasquez, and Wells) (8 pages) and Judge Gustafson (joined by Judges Foley, Kroupa, Vasquez, and Wells) (21 pages) wrote separate opinions concurring in part and dissenting in part.

Amazing news. GLAD is having a community conference call with the attorneys who worked on the case, and NCTE is supporting the call. For more info on how to participate, check after the break.

If you are interested in hearing more about the case from the actual attorneys who worked on it, please join us for the call.

Toll Free Dial-In Number: 1-800-704-9804
Participant Code(s):   61898641#

Wednesday February 3
6:00 PM Eastern Time Zone
5:00 PM Central Time Zone
4:00 PM Mountain Time Zone
3:00 PM Pacific Time Zone

1 Comment on US Tax Court Rules GID Expenses Deductible

  1. ginasf says:

    Big thanks to GLAD and Ms. O’Donnabhain for this huge decision (even if it did take 2 years wait to get it). This is an excellent model of how to get rights even when the supposed allies in government are dragging their feet.

    NCTE had nothing to do with this case… so typically they try to leech off someone else’s accomplishment. Shame on them.

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