The United States Tax Court, in a decision reviewed by the full bench, has affirmed that medical treatments for Gender Identity Disorder (GID), including surgery and hormone therapy, are deductible medical expenses.
The Court found that the Internal Revenue Service's existing position that such treatment is cosmetic in nature "is at best a superficial characterization of the circumstances that is thoroughly rebutted by the medical evidence."
The case stemmed from the IRS's denial of Rhiannon O'Donnabhain's 2001 deduction of her sex reassignment surgery costs. The IRS called her surgery "cosmetic" -- like teeth whitening or hair transplants.