IRS Affirms that Transition-Related Care is Tax Deductible

The Internal Revenue Service (IRS) has affirmed that transgender people can deduct their hormone therapy and sex reassignment surgery expenses.  This announcement indicates that the IRS will follow the U.S. Tax Court’s 2010 ruling in O’Donnabhain v. Commissioner, which held that gender identity disorder (GID) is a medical condition, and transgender people receiving hormone therapy or sex reassignment surgery as treatment for GID may deduct these costs as medical expenses.

As with other medical expenses, anyone seeking to deduct transition-related care from their gross income must be able to document that they incurred these expenses as treatment for a medical condition—in this instance, GID.  For more information about deducting transition-related care from your federal taxes, see NCTE’s factsheet, Federal Taxes and Transgender People: Frequently Asked Questions.

The IRS’s affirmation of this policy marks one of the strongest victories we’ve seen from the Obama Administration.  NCTE applauds the IRS, as well as our colleagues at Gay and Lesbian Advocates and Defenders and the Human Rights Campaign, for their work on this issue.