IRS Ruling Clarifies Medical Expense Deductions for Fertility Treatments and Surrogacy
IRS Allows Medical Deduction for IVF, Not for Surrogacy Costs: The IRS has permitted a medical expense deduction for certain costs tied to a married couple’s in vitro fertilization (IVF), such as medical screenings, fertility medications and treatments, and the retrieval of eggs and sperm.
However, it disallowed deductions for expenses associated with gestational surrogacy, specifically, payments made to a surrogate and other related costs. Under IRC Section 213, taxpayers may deduct qualified medical expenses paid during the year that are not covered by insurance or other sources, to the extent they exceed 7.5% of adjusted gross income.
Qualified “medical care” includes costs for diagnosing, curing, mitigating, treating, or preventing disease, or for affecting any structure or function of the body.
If you’re navigating complex medical expense deductions or have questions about what qualifies under IRS rules, our team is here to help. Contact us today to ensure you’re making the most of your eligible deductions.
For more on the medical expense deduction, see Chapter 25 (Medical Expenses) of PPC’s 1040 Deskbook. Ltr. Rul. 202518023.
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