Saturday, February 06, 2010

Tranny Deduction Update

Several summers ago, we wrote about a "57-year-old suburban Boston man [who] underwent a sex-change operation ... wrote off the $25,000 in medical expenses on her [his?] taxes ... But the IRS disallowed the deduction."

Flashing forward [ed: was that really necessary?], we learn that the "U.S. Tax Court ruled Tuesday that a Massachusetts woman should be allowed to deduct the costs of her sex-change operation."

While this may well have "broad implications for transgender people" (and again, do they really need to use the term "broad?"), it has even, um, broader implications for transgender folks who also have an "alternative benefit" plan (HSA, HRA, FSA). The general rule of thumb is that, if its deductable on your taxes, it's eligible for tax-advantaged reimbursement under these plans [ed: the relevant controlling authority is IRS form 213(d), which appears not to have been updated - yet - to reflect this new reality]. If that's the case, then it seems to me that we now have a whole new demographic that should be clamoring against a gummint-run health care system that would do away with many of these benefits.
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