December 11, 2018

Do you know about the cups?

Sex Change Expenses Are Deductible but You’re on Your Own for the C Cup

He seemed to have it all — a wife, three kids, a successful career. But it wasn’t enough. What he really wanted was another X chromosome. Our taxpayer, explains the Tax Court, “was uncomfortable in the male gender role from childhood and first wore women’s clothing secretly around age 10…discomfort regarding her gender intensified in adolescence…[The taxpayer] was a female trapped in a male body, and continued to secretly wear women’s clothing.”

So our taxpayer consulted a licensed social worker, which is apparently how these things are done, and after suitable counseling, decided to try on XX for size. The first steps down the path the the Misses Department seemed to suit the taxpayer, so he took the next big leap. $21,741 of surgical and related expenses later, the taxpayer was Ms. Rhiannon O’Donnabhain.


The Tax Court got involved when she deducted these expenses on her 2001 tax return. The IRS said that the expenses were not “medical” expenses under Sec. 219. It would be an unusual man who would undergo this sort of thing absent dire medical need: “The procedures that Dr. Meltzer carried out included surgical removal of the penis and testicles and creation of a vaginal space using genital skin and tissue.”

It took 139 pages and 4 separate opinions, but the Tax Court agreed that the gender reassignment surgery is a deductible medical expense. It’s surprising that it was so difficult, considering that the court is largely composed of men who wear dresses at work. But they felt it was necessary to go into the sort of privacy-killing detail that makes taxpayers think twice before spurning an appeals offer and going to Tax Court (oh, you mean you’re that Rhiannon O’Donnabhain!):

Petitioner, anticipating the formal recommendations for her surgery, went for a consultation and examination by Dr. Meltzer in June 2001 at his offices in Portland, Oregon. Dr. Meltzer concluded that petitioner was a good candidate for sex reassignment surgery. Dr. Meltzer’s notes of his physical examination of petitioner state: “Examination of her breasts reveal [sic] approximately B cup breasts with a very nice shape.”

Nice enough for government work, anyway. The Court ruled that while the hormone therapy, vaginoplasty, feminizing facial surgery and penis and testicle removal were deductible, breast augmentation was, well, too much:

given the contemporaneous documentation of the breasts’ apparent normalcy and the failure to adhere to the Benjamin standards’ requirement to document breast-engendered anxiety to justify the surgery, we find that petitioner’s breast augmentation surgery did not fall within the treatment protocol… Instead, the surgery merely improved her appearance.

So if the Tax Court’s view holds up on appeal, you can deduct the cost of changing sides, but if that’s not enough to make you sufficiently hot, you’re on your own.