Interview with GLAD Attorney on IRS Trans Medical Deduction Denial Case

GLAD goes to trial in U.S. Tax Court tomorrow (July 24) on behalf of Rhiannon O'Donnabhain, who is challenging the IRS' decision to deny her a tax deduction for her sex reassignment surgery. (More background on this story here).

Senior Staff Attorney Jennifer Levi (left), a member of the GLAD team representing Rhiannon, talked with us about the importance of the case.

What is this case about?

Jennifer Levi (JL): In this case, the IRS denied a tax deduction for a transsexual woman who deducted medical expenses relating to her transition.

Why did the IRS deny her deduction?

JL: The position that the IRS has taken is that the surgeries that Rhiannon had were “cosmetic.” And what that means is that they’re insignificant--they’re just about trying to look better. And these weren’t about “looking better.” They were about transition. They were about being able to, not just transform the way she looked, but the way she felt, and the way that she was able to present her gender in the world. To trivialize this kind of surgical procedure, and to compare it to something like a nose job, is demeaning. And really centrally misses the basic point of transgender identity.

So you think that the IRS’s decision shows an underlying bias against trans people?

JL: Absolutely. We think it shows bias at worst, and a gross misunderstanding at best.

Why should Rhiannon have been able to deduct the surgery as a medical expense?

JL: The Internal Revenue Code allows deductions for expenses relating to medical care. The entire reason Rhiannon sought psychotherapy--and eventually hormones and surgery for the feelings that she had about being female--was medical. She was diagnosed with Gender Identity Disorder (GID), as recognized in the DSM IV, in the World Health Organization’s ICD-10, and in every major textbook and medical dictionary that addresses issues relating to mental health.

There’s just no real question that for some people whose gender identity doesn’t match their sex, that experience causes very serious anxiety, distress, sadness, and depression. And people should have access to medical care.

There’s an established course of treatment Rhiannon followed that clearly meets the statutory definition for medical care. All we have to show in this case is that the procedures she underwent were medical in nature. To suggest that they’re not is really to call into question the legitimacy of that experience of dysphoria.

Why is this case important?

JL: It’s important because it addresses pervasive misunderstandings, pervasive bias, pervasive prejudice that transgender people face. There is a lot of misinformation that underlies the discrimination that transgender people face in many areas of their lives.

What we’ve found in the context of this case is that most people really do see through what the IRS has said. People understand that if you wake up every day and you look in the mirror and the person that you see is not the person you feel like you are, that’s an uncomfortable experience at best, and disorienting and disabling at worst. Fair-minded people understand that individuals should be able to take steps to change that experience and integrate their lives more fully in order to be who they are--in order to wake up every day and see the person in the mirror that they feel themselves to be. And that when somebody does that, they shouldn’t be fired from their jobs, they shouldn’t be beaten up on the streets, they shouldn’t be denied equal treatment that other Americans receive under something as basic as the tax code.

Rhiannon’s experience is one piece of the experience of transgender people. Not everybody has the same interest in transitioning medically. Not everyone can afford to, and not everyone would want to. But this is an important case for the entire community. And that’s because what’s really at the heart of this case is a central misunderstanding about the importance of being able to express one’s gender identity. Everybody should be able to do that.