Internal Revenue Service, Plastic Surgery and The Transgender Community: A Small Victory

Houston & Sugar Land, Texas

Mar 07, 2011

Until a recent United States Tax Court ruling (referred to as an acquiescence), transgender patients seeking to surgically transition to their gender identification through gender reassignment surgery were denied the benefit of using surgical costs as a deduction because previous IRS Revenue Rulings classified such plastic surgery as merely cosmetic in nature.  What attorneys at the IRS and federal tax court judges failed to realize is that transition has nothing to do with one’s outward aesthetic appearance, but everything to do with the patient’s essence.  From this point forward, patients who undergo gender reassignment surgery may deduct the costs as a medical expense, just like a person who has heart surgery or some other “approved” medical procedure.  Nevertheless, the IRS has not extended deductions to plastic surgery procedures such as breast augmentation, breast reduction, or rhinoplasty yet as they are deemed by the IRS as merely cosmetic for the general population, including the non-transgender population.  However, one may make a sound argument to deduct the cost of rhinoplasty if there is also a need for septoplasty to correct a deviated septum.  One never knows what the future holds, and with increasing acceptance and understanding by the general population of the transgender community, attorney advocates may have an improved forum to make the case that breast augmentation, rhinoplasty, and other cosmetic procedures are essential to the identity of a transitioning transgender patient.  Stay tuned and make your voice heard by letting your government representatives know you feel as well as educating them about such issues.