Egg Donation Tax Deductible?

This is something that is not often talked about, or even thought about until after the fact, but it is really important considering how much money is involved in egg donation treatments.

Katherine Pratt from the Loyola Law School in Los Angeles has now written a paper on this titled “Deducting the Costs of Fertility Treatment: Implications of Magdalin v. Commissioner for Opposite-Sex Couples, Gay and Lesbian Same-Sex Couples, and Single Women and Men”

Now, I am by no means a lawyer, but I will just share the abstract here with you:

This Article considers whether federal tax law permits taxpayers to deduct medical expenses (or exclude flexible spending account reimbursements) for fertility treatment costs, including the costs of in vitro fertilization (IVF), egg donor, and surrogate procedures. Magdalin v. Commissioner (December 2008) calls into question the deductibility of IVF, egg donor, and surrogacy costs, and, perhaps unintentionally, the deductibility of the costs of various other types of reproductive medical care (e.g., sterilizations, birth control pills, legal abortions, and vasectomies).

Which, as far as I can tell pretty much means that it goes into detail of all the costs that come with egg donation treatments.

This Article explores the tax implications of the case for infertile and fertile taxpayers, including opposite-sex married and unmarried couples, gay and lesbian same-sex couples, and single women and men.

I think this is really interesting, because it talks about the “odd cases” too, not just the “classic married heterosexual couple trying to have a baby” case.

The case indicates that the tax deductibility of fertility treatment costs turns on: (1) whether the taxpayer (or “his spouse”) has been diagnosed with “medical” infertility; (2) how we constitute “the body,” “of” “the taxpayer, his spouse, or dependents;” (3) the taxpayer’s sex, marital status, and sexual orientation; and (4) what the IRS and judges implicitly consider to be “natural” or “normal” reproduction. As the case illustrates, most legal discourse – including tax discourse – regarding assisted reproductive technologies assumes that: (1) the need for fertility treatment arises because of medical infertility; (2) women, not men, are infertile; and (3) fertility treatment is undertaken to allow an opposite-sex married couple to bear a child in the context of a traditional nuclear family. This Article also addresses the taxpayer’s argument that the status-based distinctions in section 213 are unconstitutional, discusses the circumstances in which section 213 does and does not aggregate “bodies,” and notes the ways in which law constitutes “the body,” based on notions of what is “natural” or “normal.”

You can download the complete article here as a PDF.