Early in January, the IRS dropped what should have been seen as a bombshell when it released Chief Counsel Memorandum 200603025 (Jan. 20, 2006). That item, prepared in October 2005 in response to a request for advice on medical expense deductions, held that gender reassignment surgery was not a medical expense deductible under Section 213 of the Code.
Section 213 allows a deduction for "medical care" which is defined to include diagnosis, cure, mitigation, treatment or prevention of illness or disease or promotion of the proper functioning of the body. Congress restricted the provision in 1990 to ensure that no deduction was allowed for purely personal, cosmetic surgery such as face lifts or hair removal by electrolysis. As the IRS memorandum notes, the Senate, which added the cosmetic surgery restriction, indicated in the Senate Report that "cosmetic surgery" should not be treated as "medical care" unless it treated a congenital abnormality, an accident or trauma or a disfiguring disease.
The memorandum concludes, apparently in spite of the evidence in the case that the taxpayer in question had a severe identity disorder that had not responded to psychiatric care, that the taxpayer's gender reassignment surgery was "cosmetic surgery" that was not deductible. The memorandum states "There is nothing to substantiate that these expenses were incurred to promote the proper function of the taxpayer's body" and they "were not incurred for treatment of a disfiguring condition arising from a congenital abnormality, personal injury, trauma or disease."
In justifying the treatment of this surgery as "cosmetic surgery" that is generally ineligible for the medical deduction rather than treatment for an illness, the IRS memorandum quotes the work of one person--Paul McHugh, a professor who has served as the sex adviser to the Vatican and fought strenuously against the recognition of gender identity problems. The McHugh article, it claims, establishes that the treatment is "controversial." The article quoted, which discusses McHugh's decision, as head of psychiatry at Johns Hopkins, to stop recommending gender reassignment surgery and close down the gender clinic thirty years ago, is available on a website maintained by the Catholic Church and originally published in a Catholic religious periodical, the Journal of Religion, Culture, and Public LIfe. See Surgical Sex, by Paul McHugh (November, 2004). It includes a paragraph describing transexual individuals in disparaging terms that belittle them as persons. I see no resemblance in his description to the transsexual women I have met during my professional life as an educator in New York and Illinois.
The American Psychiatry Association recognized gender identity disorder more than a quarter century ago, and gender reassignment surgery is clearly a medical treatment that is reserved for the most severe cases because of the radical nature of the surgery. See this description at "athealth.com". (For a male transforming to a female, the full surgery amputates the penis, provides hormones to enlarge breasts, and reconstructs the pelvic area to create a vagina-like opening.) The following is At Health's description of the way gender reassignment surgery is handled (mentioned briefly in the memorandum in the "facts" section to note that the taxpayer went through the Benjamin protocol).
Adults who have severe gender identity disorder which has persisted for many years sometimes request reassignment of their sex, or sex-change surgery. Prior to this kind of surgery they usually go through a long period of hormone therapy which attempts to suppress same sex characteristics and accentuate other sex characteristics. For instance, males that have gender identity disorder will be given the female hormone, estrogen. The estrogen causes the male breasts to enlarge, testes to become smaller, and body hair to diminish. Females with gender identity disorder will be given the male hormone, testosterone, to help them develop a lower voice and possibly a full beard. Following the hormone treatment, the adult will be asked to live in a cross-gender role before surgery to alter their genitalia or breasts is performed.
The difference between gender reassignment surgery and a face lift should be obvious to all. People who have such surgery face a difficult life if they cannot make their bodies mesh with their gender identity. If cosmetic surgery after an accident scars a face is deductible, then so should this be.
The IRS's adoption of the position that gender reassignment surgery is mere cosmetic surgery reflects a bias and religious slant that should not play a role in statutory interpretation. Most disturbing is the use of the McHugh piece as the sole authority on the (in)validity of gender reassignment surgery. McHugh's caricature of those who have undergone gender reassignment and his role as an adviser on sexual matters to the Vatican both suggest a biased approach. The position, of course, is one that resonates with the right-wing fundamentalist political base of this Administration. It must ring hollow to those who suffer from severe gender identity problems and must fund their surgery without the aid of the deduction available to others who seek to remedy genuine problems with reconstructive surgery.
Commentary on Paul McHugh's long-time campaign against sex-change surgery