Gender Dysphoria and Taxes

A Massachusetts woman will soon be going to tax court with the IRS. See Rhiannon O'Donnabhain used to be a man till having SRS. Then she tried to take a deduction on her taxes for the surgery. The IRS disallowed it. Therefore the case in tax court.

I think Ms. O'Donnabhain has a case,(TFM wishes she chose a different last name. I'm cutting and pasting instead of spelling it. LOL) though I disagree with her thinking the IRS decision was based on prejudice. Its far more likely to based on both the standard IRS that they're always right. The case where travel expenses for a relative of someone having SRS being allowed in addition to Gender Dysphoria being a recognized medical condition, would seem to give Ms. O'Donnabhain solid legal ground to stand on. I'll be interested to hear what the final outcome is. Good luck to Rhiannon O'Donnabhain.

Final Note- SRS aka Sex change surgery, is not covered by most insurance. So the patient in almost all instances has to pay for the surgery out of pocket.

Linked to- Amboy Times, Big Dog, Bullwinkle, Leaning Straight Up,

BOSTON (AP) — After a tormented existence as a father, a husband, a Coast Guardsman and a construction worker, a 57-year-old suburban Boston man underwent a sex-change operation. Then she wrote off the $25,000 in medical expenses on her taxes.
But the IRS disallowed the deduction — ruling the procedure was cosmetic, not a medical necessity — in a potentially precedent-setting dispute now before the U.S. Tax Court.

Rhiannon O'Donnabhain is suing the IRS in a case advocates for the transgendered are hoping will force the tax agency to treat sex-change operations the same as appendectomies, heart bypasses and other deductible medical procedures. The case is set to go to trial July 24.

An estimated 1,600 to 2,000 people a year undergo sex-change surgery in the United States, according to the Gay and Lesbian Medical Association.

O'Donnabhain said she could have paid back the approximately $5,000 she received in her tax refund, but decided to challenge the IRS because she believes the ruling against her was rooted in politics and prejudice.

"This goes way beyond money," O'Donnabhain said in an interview with The Associated Press. "If I were to give the money back, it would be saying it's OK for you to do this to me. It is not OK for them to do this to me or anyone like me."

The U.S. Tax Court has never issued an opinion in a similar case, said Jennifer Levi, an attorney with Gay & Lesbian Advocates & Defenders, the Boston-based legal organization representing O'Donnabhain. But the IRS has ruled against allowing the deduction in at least one other case.

In a 2005 case, the IRS ruled the costs of a woman's gender reassignment surgery and related treatments were not deductible as medical expenses.

The IRS cited the section of the tax code that says cosmetic surgery or similar procedures are deductible only when they are needed to improve a congenital abnormality, an accident or trauma, or a disfiguring disease.

In a 1983 case, however, the IRS allowed a father to deduct his transportation costs when he accompanied his college-age son to a clinic where he received a sex-change operation.

Levi argues that because gender-identity disorder is a recognized mental disorder that is generally treated with hormones and surgery, the costs are legitimate medical deductions.

"Every mental health textbook and medical dictionary recognizes the legitimacy of both the diagnosis and course of treatment," Levi said.

IRS officials declined to comment, citing the upcoming trial.

Robert Adelson, a Boston tax attorney, said the IRS "might take the position that you were dealt a particular hand, you are the gender you are, and if you want to now change the gender, should the government now subsidize you to do so?"

Others say the IRS has made a mistake.

"The IRS ruling is pure bias, since scientists agree that gender transition services are medically necessary and not cosmetic," said Joel Ginsberg, executive director of the Gay and Lesbian Medical Association.

O'Donnabhain (pronounced oh-DON-oh-vin) will not disclose her original name to protect her family's privacy. She said she struggled with uncomfortable feelings she could not identify while growing up in an Irish Catholic family.