O'Donnabhain v. Comm'r , 134 T.C. 34 ( 2010 )

RHIANNON G. O’DONNABHAIN, PETITIONER v. COMMISSIONER
OF INTERNAL REVENUE, RESPONDENT
Docket No. 6402–06. Filed February 2, 2010.
In 1997, P, born a genetic male, was diagnosed with gender
identity disorder, a condition recognized in medical reference
texts, in which an individual experiences persistent psycho-
logical discomfort concerning his or her anatomical gender.
Medical professionals who treat gender identity disorder pre-
scribe for its treatment in genetic males, depending on the
severity of the condition, (i) administration of feminizing hor-
mones; (ii) living as a female in public; and (iii) after at least
a year of living as a female, surgical modification of the geni-
tals and, in some circumstances, breasts to resemble those of
a female (sex reassignment surgery). Pursuant to this treat-
ment regimen, P was prescribed feminizing hormones in 1997
and continued to take them through 2001. In 2000, after
plastic surgery to feminize facial features, P began presenting
full time in public as a female. In 2001 P underwent sex
reassignment surgery, including breast augmentation surgery.
P claimed a medical expense deduction under sec. 213, I.R.C.,
for the cost of the surgeries, transportation and other related
expenses, and feminizing hormones, for the taxable year 2001.
R disallowed the deduction. Held: P’s gender identity disorder
is a ‘‘disease’’ within the meaning of sec. 213(d)(1)(A) and
(9)(B), I.R.C. Held, further, P’s hormone therapy and sex
reassignment surgery were ‘‘for the * * * treatment * * * of ’’
and ‘‘[treated]’’ disease within the meaning of sec. 213(d)(1)(A)
and (9)(B), I.R.C., respectively, and consequently the proce-
dures are not ‘‘cosmetic surgery’’ that is excluded from the
definition of ‘‘medical care’’ by sec. 213(d)(9)(A), I.R.C., and
instead the amounts paid for the procedures are expenses for
‘‘medical care’’ that are deductible pursuant to sec. 213(a),
I.R.C. Held, further, P’s breast augmentation surgery was
‘‘directed at improving * * * [her] appearance’’ and she has
not shown that the surgery either ‘‘meaningfully [promoted]
the proper function of the body’’ or ‘‘[treated] * * * disease’’
within the meaning of sec. 213(d)(9)(B), I.R.C. Accordingly,
the breast augmentation surgery is ‘‘cosmetic surgery’’ within
the meaning of sec. 213(d)(9)(B), I.R.C., that is excluded from
the definition of deductible ‘‘medical care’’ by sec. 213(d)(9)(A),
I.R.C.
Karen L. Loewy, Bennett H. Klein, Jennifer L. Levi, Wil-
liam E. Halmkin, David J. Nagle, and Amy E. Sheridan, for
petitioner.
Mary P. Hamilton, John R. Mikalchus, Erika B. Cormier,
and Molly H. Donohue, for respondent.
34
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(34) O’DONNABHAIN v. COMMISSIONER 35
GALE, Judge: Respondent determined a deficiency of $5,679
in petitioner’s Federal income tax for 2001. After conces-
sions, 1 the issue for decision is whether petitioner may
deduct as a medical care expense under section 213 2
amounts paid in 2001 for hormone therapy, sex reassignment
surgery, and breast augmentation surgery that petitioner
contends were incurred in connection with a condition known
as gender identity disorder.
FINDINGS OF FACT
Many of the facts have been stipulated, and the stipulated
facts and attached exhibits are incorporated in our findings
by this reference. The parties have stipulated that this case
is appealable to the U.S. Court of Appeals for the First Cir-
cuit.
I. Petitioner’s Background
Rhiannon G. O’Donnabhain (petitioner) was born a genetic
male with unambiguous male genitalia. However, she 3 was
uncomfortable in the male gender role from childhood and
first wore women’s clothing secretly around age 10. Her
discomfort regarding her gender intensified in adolescence,
and she continued to dress in women’s clothing secretly.
As an adult, petitioner earned a degree in civil
engineering, served on active duty with the U.S. Coast
Guard, found employment at an engineering firm, married,
and fathered three children. However, her discomfort with
her gender persisted. She felt that she was a female trapped
in a male body, and she continued to secretly wear women’s
clothing.
Petitioner’s marriage ended after more than 20 years.
After separating from her spouse in 1992, petitioner’s
feelings that she wanted to be female intensified and grew
more persistent. 4
1 Petitioner concedes that she is not entitled to any deduction for an individual retirement ac-
count contribution, and respondent concedes that petitioner is entitled to deduct $1,369.59 as
medical expenses under sec. 213.
2 Unless otherwise indicated, all section references are to the Internal Revenue Code of 1986,
as amended and in effect in the year in issue, and all Rule references are to the Tax Court Rules
of Practice and Procedure.
3 Reflecting petitioner’s preference, we use the feminine pronoun to refer to her throughout
this Opinion.
4 Petitioner and her spouse were divorced in 1996.
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36 134 UNITED STATES TAX COURT REPORTS (34)
II. Petitioner’s Psychotherapy and Diagnosis
By mid-1996 petitioner’s discomfort with her male gender
role and desire to be female intensified to the point that she
sought out a psychotherapist to address them. After inves-
tigating referrals, petitioner contacted Diane Ellaborn (Ms.
Ellaborn), a licensed independent clinical social worker
(LICSW) and psychotherapist, and commenced psychotherapy
sessions in August 1996.
Although not a medical doctor, Ms. Ellaborn had a mas-
ter’s degree in social work and as an LICSW was authorized
under Massachusetts law to diagnose and treat psychiatric
illnesses. She had specialized training in the diagnosis and
treatment of gender-related disorders.
During petitioner’s psychotherapy Ms. Ellaborn learned of
petitioner’s cross-dressing history and of her longstanding
belief that she was really female despite her male body. Ms.
Ellaborn observed that petitioner was very sad and anxious,
had very low self-esteem, had limited social interactions, and
was obsessed with issues concerning the incongruence
between her perceived gender and her anatomical sex.
In early 1997, after approximately 20 weekly individual
therapy sessions, Ms. Ellaborn’s diagnosis was that peti-
tioner was a transsexual suffering from severe gender
identity disorder (GID), a condition listed in the Diagnostic
and Statistical Manual of Mental Disorders (4th ed. 2000
text revision) (DSM–IV–TR), published by the American Psy-
chiatric Association. The DSM–IV–TR states that a diagnosis
of GID is indicated where an individual exhibits (1) a strong
and persistent desire to be, or belief that he or she is, the
other sex; (2) persistent discomfort with his or her anatom-
ical sex, including a preoccupation with getting rid of pri-
mary or secondary sex characteristics; (3) an absence of any
physical intersex (hermaphroditic) condition; and (4) clini-
cally significant distress or impairment in social, occupa-
tional, or other important areas of functioning as a result of
the discomfort arising from the perceived incongruence
between anatomical sex and perceived gender identity. 5 See
5 In reaching her diagnosis Ms. Ellaborn considered and ruled out other causes—so-called co-
morbid conditions—of petitioner’s symptoms, including psychosis, an earlier diagnosis of atten-
tion deficit/hyperactivity disorder, depression, and transvestic fetishism.
Transvestic fetishism ‘‘occurs in heterosexual (or bisexual) men for whom the cross-dressing
behavior is for the purpose of sexual excitement. Aside from cross-dressing, most individuals
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(34) O’DONNABHAIN v. COMMISSIONER 37
DSM–IV–TR at 581. Under the classification system of the
DSM–IV–TR, a severity modifier—mild, moderate, or severe—
may be added to any diagnosis. 6 The term ‘‘transsexualism’’
is currently used in the DSM–IV–TR to describe GID symptoms
that are severe or profound. 7
Both the DSM–IV–TR and its predecessor the DSM–IV con-
tain the following ‘‘Cautionary Statement’’:
The purpose of DSM–IV is to provide clear descriptions of diagnostic cat-
egories in order to enable clinicians and investigators to diagnose, commu-
nicate about, study, and treat people with various mental disorders. It is
to be understood that inclusion here, for clinical and research purposes, of
a diagnostic category * * * does not imply that the condition meets legal
or other non-medical criteria for what constitutes mental disease, mental
disorder, or mental disability. * * *
III. Treatment of GID
The World Professional Association for Transgender Health
(WPATH), formerly known as the Harry Benjamin Inter-
national Gender Dysphoria Association, Inc., is an associa-
tion of medical, surgical, and mental health professionals
specializing in the understanding and treatment of GID. 8
WPATH publishes ‘‘Standards of Care’’ for the treatment of
GID (hereinafter Benjamin standards of care or Benjamin
standards). The Benjamin standards of care were originally
with Transvestic Fetishism do not have a history of childhood cross-gender behaviors.’’ DSM–
IV–TR at 580. Petitioner reported to Ms. Ellaborn that she cross-dressed in order to feel more
feminine rather than for purposes of sexual arousal.
6 A modifier of ‘‘severe’’ indicates that there are many more symptoms than those required
to make the diagnosis, or several symptoms that are particularly severe are present, or the
symptoms result in marked impairment in social and occupational functioning beyond the min-
imum threshold required for diagnosis. See DSM–IV–TR at 2.
7 The GID diagnosis was labeled ‘‘transsexualism’’ when it first appeared in the third edition
of the DSM published in 1980 (DSM–III). The fourth edition of the DSM, published in 1994
(DSM–IV), replaced the transsexualism diagnosis with GID and added the criterion for the diag-
nosis that the patient exhibit clinically significant distress or impairment in important areas
of functioning. The DSM–IV underwent a text revision in 2000, resulting in the DSM–IV–TR,
but there are no material differences in the DSM’s treatment of GID as between the DSM–IV
and DSM–IV–TR editions.
Notwithstanding the replacement of the transsexualism diagnosis with GID, the terms
‘‘transsexualism’’ and ‘‘transsexual’’ are still used generally in psychiatry to refer to severe or
profound GID— or a sufferer thereof.
8 Harry Benjamin, M.D. (1885–1986), was an endocrinologist who in conjunction with mental
health professionals in New York did pioneering work in the study of transsexualism. The par-
ties have stipulated that the term ‘‘gender dysphoria’’ was coined by Dr. Norman Fisk (Dr. Fisk)
in 1973 to describe patients presenting with dissatisfaction and unhappiness with their ana-
tomic and genetic sex and their assigned gender. The parties have further stipulated that, ac-
cording to a 1974 article by Dr. Fisk, transsexualism represents the most extreme form of gen-
der dysphoria.
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38 134 UNITED STATES TAX COURT REPORTS (34)
approved in 1979 and have undergone six revisions through
February 2001.
Summarized, the Benjamin standards of care prescribe a
‘‘triadic’’ treatment sequence for individuals diagnosed with
GID consisting of (1) hormonal sex reassignment; i.e., the
administration of cross-gender hormones to effect changes in
physical appearance to more closely resemble the opposite
sex; 9 (2) the ‘‘real-life’’ experience (wherein the individual
undertakes a trial period of living full time in society as a
member of the opposite sex); and (3) sex reassignment sur-
gery, consisting of genital sex reassignment and/or nongen-
ital sex reassignment, more fully described as follows:
Genital surgical sex reassignment refers to surgery of the genitalia and/
or breasts performed for the purpose of altering the morphology in order
to approximate the physical appearance of the genetically other esx [sic]
in persons diagnosed as gender dysphoric. * * * Non-genital surgical sex
reassignment refers to any and all other surgical procedures of non-genital,
or non-breast, sites (nose, throat, chin, cheeks, hips, etc.) conducted for the
purpose of effecting a more masculine appearance in a genetic female or
for the purpose of effecting a more feminine appearance in a genetic male
in the absence of identifiable pathology which would warrant such surgery
regardless of the patient’s genetic sex (facial injuries, hermaphroditism,
etc.).
Under the Benjamin standards, an individual must have
the recommendation of a licensed psychotherapist to obtain
hormonal or surgical sex reassignment. Hormonal sex
reassignment requires the recommendation of one
psychotherapist and surgical sex reassignment requires
the recommendations of two. 10 The recommending
psychotherapist should have diagnostic evidence for
transsexualism for a period of at least 2 years, independent
of the patient’s claims.
The Benjamin standards state that hormonal sex reassign-
ment should precede surgical sex reassignment because the
patient’s degree of satisfaction with hormone therapy ‘‘may
indicate or contraindicate later surgical sex reassignment.’’
9 Both parties’ experts agree that administration of cross-gender hormones in genetic males
with GID also has a psychological effect, producing a sense of well-being and a ‘‘calming effect’’.
10 To be qualified to recommend hormonal or surgical sex reassignment, a psychotherapist
must have (1) a master’s degree in clinical behavioral science, and at least one of the
recommenders for surgical sex reassignment must have a doctoral degree in the field; (2) com-
petence in psychotherapy as demonstrated by a State license to practice it; and (3) specialized
competence in sex therapy and gender identity disorders as demonstrated by supervised clinical
experience and continuing education.
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(34) O’DONNABHAIN v. COMMISSIONER 39
The Benjamin standards further state that ‘‘Genital sex
reassignment shall be preceded by a period of at least 12
months during which time the patient lives full-time in the
social role of the genetically other sex.’’ The standards pro-
vide that breast augmentation surgery may be performed as
part of sex reassignment surgery for a male-to-female patient
‘‘if the physician prescribing hormones and the surgeon have
documented that breast enlargement after undergoing hor-
mone treatment for 18 months is not sufficient for comfort in
the social gender role.’’
IV. Ms. Ellaborn’s Treatment Plan for Petitioner
After diagnosing severe GID in petitioner in early 1997, Ms.
Ellaborn administered a course of treatment that followed
the Benjamin standards of care. 11
A. Petitioner’s Hormone Treatments
In February 1997 Ms. Ellaborn referred petitioner to an
endocrinologist for feminizing hormone therapy, and peti-
tioner commenced taking hormones in September 1997. 12
She remained on feminizing hormones continuously through
the taxable year in issue (2001). 13
After beginning hormone therapy petitioner told Ms.
Ellaborn that she felt calmer and better emotionally and that
she felt positive about her physical changes. Ms. Ellaborn
viewed petitioner’s positive reactions to hormone therapy as
validation of the GID diagnosis.
Petitioner advised her former spouse and children of her
GID diagnosis in 1997 and 1998, respectively. 14
B. Petitioner’s ‘‘Real-Life’’ Experience
In consultation with Ms. Ellaborn, petitioner decided to
undertake the Benjamin standards’ ‘‘real-life’’ experience; i.e.,
to present in public as female on a full-time basis in March
11 Petitioner
attended monthly individual therapy sessions throughout most of 1997.
12 Petitioner
was hesitant about starting hormones and changing her appearance too quickly.
She was concerned about the impact on her children and coworkers. Petitioner’s 16-year-old son
was living with her at the time, and petitioner wished to postpone significant changes in her
appearance until after her son had graduated from high school and begun college.
13 Petitioner also commenced electrolysis treatments to remove body hair in September 1997
and continued them through 2005. The deductibility of the expenses related to electrolysis is
not at issue.
14 The children’s reactions were characterized by embarrassment, anger, denial, and with-
drawal.
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40 134 UNITED STATES TAX COURT REPORTS (34)
2000. Petitioner legally changed her name from Robert
Donovan to Rhiannon G. O’Donnabhain and arranged to
have the gender designation on her driver’s license changed,
on the basis of her GID diagnosis. 15 She underwent surgery
to feminize her facial features, 16 and with the cooperation of
her employer commenced presenting as a female at work
around April of that year. Petitioner informed Ms. Ellaborn
that her transition at work went smoothly and that the ‘‘real-
life’’ experience had been ‘‘incredibly easy’’. Ms. Ellaborn
viewed petitioner’s positive response to her ‘‘real-life’’ experi-
ence as further validation of the GID diagnosis.
C. Petitioner’s Sex Reassignment Surgery
Petitioner’s anxiety as a result of having male genitalia
persisted, 17 however, and Ms. Ellaborn concluded that her
prognosis without genital surgical sex reassignment (sex
reassignment surgery) was poor, in that petitioner’s anxiety
over the lack of congruence between her perceived gender
and her anatomical sex would continue in the absence of sur-
gery and would impair her ability to function normally in
society. In November 2000 Ms. Ellaborn wrote a referral
letter to Dr. Toby Meltzer (Dr. Meltzer), a board-certified
plastic and reconstructive surgeon, with over 10 years’
experience specializing in sex reassignment surgery, to
secure a place for petitioner on his waiting list.
After three additional therapy sessions with petitioner in
mid-2001, Ms. Ellaborn concluded that petitioner had satis-
fied or exceeded all of the Benjamin standards’ criteria for
sex reassignment surgery, including time spent satisfactorily
on feminizing hormones and in the ‘‘real-life’’ experience. In
July 2001 Ms. Ellaborn wrote a second letter to Dr. Meltzer
certifying petitioner’s GID diagnosis and satisfaction of the
15 Petitioner also carried with her a letter from Ms. Ellaborn explaining the GID diagnosis,
to be used in the event she was confronted by authorities for using a sex-segregated facility such
as a restroom or a changing room.
16 Ms. Ellaborn had observed that, notwithstanding 18 months of hormone therapy, petitioner
had distinctly male facial features which interfered with her ‘‘passing’’ as female. Ms. Ellaborn
referred petitioner to a plastic surgeon who in March 2000 performed procedures designed to
feminize petitioner’s facial features, including a rhinoplasty (nose reshaping), a facelift, and a
tracheal shave (reducing cartilage of the ‘‘Adam’s apple’’). Petitioner was dissatisfied with the
initial results, and in December 2000 the surgeon performed further surgery to revise the effects
of the earlier procedures. The surgeon also gave petitioner a Botox treatment at that time. The
deductibility of the foregoing procedures is not at issue.
17 In one instance, petitioner held a knife and had an urge to cut off her penis.
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(34) O’DONNABHAIN v. COMMISSIONER 41
Benjamin standards’ criteria for sex reassignment surgery,
and formally recommending petitioner for the sur-
gery. Another licensed psychotherapist with a doctoral degree
in clinical psychology, Dr. Alex Coleman (Dr. Coleman),
examined petitioner and provided a second recommendation
for her sex reassignment surgery, as required by the Ben-
jamin standards. Dr. Coleman’s letter to Dr. Meltzer
observed that petitioner ‘‘appears to have significant breast
development secondary to hormone therapy’’.
Petitioner, anticipating the formal recommendations for
her surgery, went for a consultation and examination by Dr.
Meltzer in June 2001 at his offices in Portland, Oregon.
Dr. Meltzer concluded that petitioner was a good candidate
for sex reassignment surgery. Dr. Meltzer’s notes of his phys-
ical examination of petitioner state: ‘‘Examination of her
breasts reveal [sic] approximately B cup breasts with a very
nice shape.’’
In mid-October 2001 petitioner returned to Portland, and
she underwent sex reassignment surgery on October 19,
2001. The procedures that Dr. Meltzer carried out included
surgical removal of the penis and testicles and creation of a
vaginal space using genital skin and tissue. The procedures
were designed to surgically reconfigure petitioner’s male
genitalia to create female genitalia both in appearance and
in function, by reconstructing the penile glans into a neo-clit-
oris, making sexual arousal and intercourse possible.
Dr. Meltzer also performed breast augmentation surgery
designed to make petitioner’s breasts, which had experienced
some development as a result of feminizing hormones, more
closely resemble the breasts of a genetic female.
In May 2002 Dr. Meltzer performed followup surgery on
petitioner to refine the appearance of her genitals and
remove scar tissue. In February 2005 Dr. Meltzer performed
further surgery on petitioner’s face, designed to feminize her
facial features. 18
V. Petitioner’s Claim for a Medical Expense Deduction
During 2001 petitioner incurred and paid the following
expenses (totaling $21,741) in connection with her hormone
therapy, sex reassignment surgery, and breast augmentation
18 The deductibility of these procedures undertaken in 2002 and 2005 is not at issue.
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42 134 UNITED STATES TAX COURT REPORTS (34)
surgery: (1) $19,195 to Dr. Meltzer for surgical procedures,
including $14,495 for vaginoplasty and other procedures,
$4,500 for breast augmentation, and $200 towards a portion
of petitioner’s postsurgical stay at Dr. Meltzer’s facility; (2)
$60 for medical equipment; (3) $1,544 in travel and lodging
costs away from home for presurgical consultation and sur-
gery; (4) $300 to Ms. Ellaborn for therapy; (5) $260 for the
consultation for a second referral letter for surgery; and (6)
$382 for hormone therapy. These payments were not com-
pensated for by insurance or otherwise.
On her Federal income tax return for 2001, petitioner
claimed an itemized deduction for the foregoing expenditures
as medical expenses, which respondent subsequently dis-
allowed in a notice of deficiency.
VI. Expert Testimony
A. Petitioner’s Expert: Dr. Brown
Petitioner’s expert, Dr. George R. Brown (Dr. Brown), is a
licensed physician, board certified in adult psychiatry by the
American Board of Psychiatry and Neurology. Dr. Brown has
been a member of the American Psychiatric Association since
1983 and was elected a Distinguished Fellow of that
organization in 2003. At the time of trial Dr. Brown was a
professor and associate chairman of the Department of
Psychiatry at East Tennessee State University and chief of
psychiatry at James H. Quillen Veterans Affairs Medical
Center in Johnson City, Tennessee.
Dr. Brown has been an active member of WPATH since
1987, including serving on its board of directors, and he
participated in the development of the Benjamin standards of
care. He has seen approximately 500 GID patients either in
a clinical setting or as an academic researcher. Dr. Brown
has published numerous papers in peer-reviewed medical
journals and written several book chapters on topics related
to GID, including those in the Merck Manuals, one of the
most widely used medical reference texts in the world.
Citing its recognition in the DSM–IV–TR, standard medical
reference texts, and World Health Organization publications,
Dr. Brown contends that there is general agreement in main-
stream psychiatry that GID is a legitimate mental disorder.
Dr. Brown indicates that there are no biological or laboratory
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(34) O’DONNABHAIN v. COMMISSIONER 43
tests that may be used to diagnose GID but notes the same
is true of virtually all of the mental disorders listed in the
DSM–IV–TR.
In Dr. Brown’s view, proper medical treatment of a person
diagnosed with GID includes extended psychotherapy and one
or more of the triadic therapies in the Benjamin standards.
Dr. Brown is not aware of any case in which psychotherapy
alone was effective in treating severe GID. For individuals
with severe GID, Dr. Brown believes completion of the entire
triadic sequence, i.e., through sex reassignment surgery, is
usually medically necessary to ‘‘cure or mitigate the distress
and maladaption caused by GID.’’
In Dr. Brown’s opinion, it is also important to the mental
health of a male with severe GID to be able to ‘‘pass’’ convinc-
ingly in public as female—that is, to be perceived as female
by members of the public. Failure to pass exacerbates the
anxieties associated with GID. Passing includes the use of
sex-segregated facilities such as restrooms and locker rooms,
where a failure to pass can result in public humiliation,
assault, or arrest. Genetic males with GID sometimes have
distinctly male facial features that make it difficult to pass,
absent surgery to feminize facial features.
According to Dr. Brown, autocastration, autopenectomy,
and suicide have been reported in patients who did not
receive appropriate treatment for their GID. Dr. Brown
rejects the idea that sex reassignment surgery is comparable
to cosmetic surgery or is undertaken to improve one’s appear-
ance, in view of the social stigma (including rejection by
family and employment discrimination) and the pain and
complications typically associated with such surgery. More-
over, Dr. Brown observes, normal genetic males generally do
not desire to have their penis and testicles removed. Such a
desire is regarded in the psychiatric literature as a likely
manifestation of psychosis (usually schizophrenia) or GID, fol-
lowed by a range of other less likely explanations. In Dr.
Brown’s opinion, people undergo sex reassignment surgery
because of the severity of their GID symptoms and the lack
of any other known effective treatment.
In Dr. Brown’s view, the scientific literature demonstrates
positive therapeutic outcomes from sex reassignment sur-
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44 134 UNITED STATES TAX COURT REPORTS (34)
gery. He cites widely used psychiatric reference texts that
reach the same conclusion. 19
On the basis of a review of petitioner’s medical records and
a telephone interview with petitioner, Dr. Brown opined that
petitioner was properly diagnosed with GID and petitioner’s
treatments, including sex reassignment surgery, were appro-
priate and medically necessary.
B. Respondent’s Expert: Dr. Schmidt
Respondent’s expert, Dr. Chester W. Schmidt, Jr. (Dr.
Schmidt), is a licensed physician, board certified in psychi-
atry by the American Board of Psychiatry and Neurology,
and a member of the American Psychiatric Association. At
the time of trial Dr. Schmidt was a professor of psychiatry
at the Johns Hopkins University School of Medicine, the
chief medical director, Johns Hopkins Health Care, and chair
of the medical board, Johns Hopkins Bayview Medical
Center.
Dr. Schmidt cofounded the Sexual Behavior Consultation
Unit of the Johns Hopkins Hospital, a clinical, teaching, and
research program devoted to the evaluation and treatment of
sexual disorders, in 1971. Since that time he has been active
in the clinical and teaching aspects of transsexualism, having
participated in the evaluation of approximately 12 patients
per year diagnosed with GID. However, he has not directly
treated or managed a patient with GID since the mid-1980s,
and his current clinical activity consists of evaluating new
cases of GID. Dr. Schmidt’s expert report states that he has
‘‘participated in the publication’’ of several peer-reviewed
medical journal articles about GID, but none has been identi-
fied for which he was a listed author, and he has never writ-
ten a chapter on the subject in a medical reference text.
In his expert report, Dr. Schmidt asserts that the validity
of the GID diagnosis remains the subject of debate within the
psychiatric profession and that he currently is undecided
about its validity. 20 However, 10 months before submitting
19 See Green, ‘‘Gender Identity Disorder in Adults’’, in New Oxford Textbook of Psychiatry 915
(Gelder, et al., eds., Oxford Univ. Press 2000); Green & Blanchard, ‘‘Gender Identity Disorders’’,
in Kaplan & Sadock’s Comprehensive Textbook of Psychiatry 1660 (Sadock & Sadock, eds., 7th
ed., Lippincott Williams & Wilkins 2000); Levine, ‘‘Sexual Disorders’’, in Psychiatry 1492
(Tasman, et al., eds., 2d ed., John Wiley & Sons 2005).
20 Dr. Schmidt’s report states that he is uncertain that GID is a mental disorder in the light
of the heterogeneity of GID patients (in terms of presentation, personality, and motivation) and
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his expert report, Dr. Schmidt provided a diagnosis of GID as
an expert in a U.S. District Court proceeding and continued
to make the diagnosis regularly through the time of trial, as
do other practitioners at the Johns Hopkins sexual disorders
clinic he cofounded. Further, Dr. Schmidt states that the GID
diagnosis is taught to psychiatrists in training at his and
other medical schools and is a condition with which they
must be familiar.
Dr. Schmidt agreed that GID requires treatment. He has
observed that ‘‘you can’t walk around day after day being
ambiguous about your gender identity. It will tear you apart
psychologically’’. Dr. Schmidt likewise agreed that untreated
GID in males can sometimes lead to autopenectomy,
autocastration, and suicide.
Dr. Schmidt believes that the Benjamin standards of care
are merely guidelines rather than true standards of care, in
that they do not meet the legal threshold of a ‘‘community’’
standard, the departure from which would constitute mal-
practice. Dr. Schmidt further believes that the Benjamin
standards enjoy only limited acceptance in American medi-
cine generally. He is unaware, however, of any significant
disagreement with the Benjamin standards within the psy-
chiatric profession, other than a minority that considers sex
reassignment surgery unethical. Dr. Schmidt agrees with the
Benjamin standards’ treatment protocols, with the exception
that he believes psychotherapy should be mandatory rather
than merely recommended for candidates for sex reassign-
ment. All GID patients at the sexual disorders clinic where
Dr. Schmidt practices are advised to become familiar with
the Benjamin standards of care.
Dr. Schmidt believes that cross-gender hormone therapy
and sex reassignment surgery have recognized medical and
psychiatric benefits for persons suffering from GID, including
reinforcement of an internal sense of consistency and balance
in their gender identity. Dr. Schmidt has also expressed the
view that once a genetic male with GID makes the decision
to transition to a female identity, everything that reinforces
the identity is helpful for psychological well-being. However,
in his opinion a therapist should remain neutral regarding
whether a patient should undergo hormone therapy or the
the lack of a scientifically supported etiology of the condition.
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46 134 UNITED STATES TAX COURT REPORTS (34)
surgery because, Dr. Schmidt believes, there is insufficient
scientific evidence of the procedures’ efficacy in treating GID.
A therapist should accordingly only take a position when
there are contraindications to the procedures, in his opinion.
Given his view that failure to adhere to the Benjamin
standards of care would not constitute malpractice and that
a therapist should remain neutral regarding the administra-
tion of hormone therapy or sex reassignment surgery, Dr.
Schmidt concludes that the procedures are elective and not
medically necessary. He acknowledges, however, that the
issue of the medical necessity of sex reassignment surgery is
‘‘contentious and variable within American medicine.’’
Finally, while noting that there is some evidence that GID
may have a neurological cause, Dr. Schmidt believes that
there is no conclusive scientific proof that GID is the result
of a genetic or congenital abnormality.
C. Respondent’s Expert: Dr. Dietz
Respondent’s expert, Dr. Park Dietz (Dr. Dietz), is a
licensed physician and board certified in psychiatry by the
American Board of Psychiatry and Neurology. Like Dr.
Brown, he is a Distinguished Fellow of the American Psy-
chiatric Association. At the time of trial Dr. Dietz was a clin-
ical professor of psychiatry and behavioral sciences at the
University of California at Los Angeles School of Medicine.
Dr. Dietz’ specialty is forensic psychiatry, and he has written
approximately 100 professional publications, mostly on
sexual, criminal, and antisocial behavior from the standpoint
of forensic psychiatry, in peer-reviewed journals, reference
text chapters, and other media. Dr. Dietz was recognized as
an expert in forensic psychiatry. He was retained by
respondent for the purpose of addressing the question of
whether GID or transsexualism is a disease or illness.
It is Dr. Dietz’ opinion that GID is a mental disorder,
susceptible of a correct or incorrect diagnosis, but not a dis-
ease or an illness because it has not been shown to arise
from a pathological process within the body—a necessary
condition for a disease in Dr. Dietz’ view. 21 While acknowl-
edging that commentators on the subject have advanced at
21 Dr. Dietz believes that ‘‘illness’’ is simply ‘‘the recognized presence of disease, usually as
a result of the host experiencing signs or symptoms, but sometimes as a result of an incidental
finding by a clinician or the observations of a third party.’’
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(34) O’DONNABHAIN v. COMMISSIONER 47
least three possible ‘‘sufficient conditions’’ for the presence of
disease (namely, discomfort, dysfunction, or pathology), Dr.
Dietz considers pathology the appropriate sufficient condi-
tion. Thus, in Dr. Dietz’ opinion, disease is defined as follows:
To be a disease, a condition must arise as a result of a pathological
process. It is not necessary that this process be fully known or understood,
but it is necessary that the pathology occur within the individual and
reflect abnormal structure or function of the body at the gross, microscopic,
molecular, biochemical, or neuro-chemical levels. * * *
Citing the cautionary statement in the DSM–IV–TR (to the
effect that inclusion of a condition in a diagnostic category of
the DSM does not imply that the condition meets legal criteria
for mental disease), Dr. Dietz asserts that the designation of
a condition as a mental disorder in the DSM–IV–TR does not
indicate that the condition is a disease. To be a disease, a
mental disorder must have a demonstrated organic or
biological origin in the individual, in his view.
Dr. Dietz testified that since qualification as a disease
under his definition depends upon a demonstration of the
condition’s organic origins, a condition may be a disease but
not known as such, pending scientific discoveries concerning
its etiology. For example, panic disorder and obsessive-
compulsive disorder are now understood to have an organic
basis, but their etiology was only discovered as a result of
laboratory advances within the last decade or so. Thus, both
conditions are diseases under Dr. Dietz’ definition, but would
not have been recognized as such 20 years ago. Dr. Dietz con-
firmed that bulimia 22 is psychologically unhealthy but not a
disease under his formulation because it has no dem-
onstrated organic etiology. Dr. Dietz was unable to say
whether anorexia 23 is a disease under his definition because
he was unfamiliar with the current state of scientific knowl-
edge of anorexia’s etiology. In Dr. Dietz’ view, post-traumatic
stress disorder is not a disease as he defines the term, but
an injury.
Dr. Dietz agrees that GID is sometimes associated with
autopenectomy, autocastration, and suicide.
22 As confirmed by Dr. Dietz, bulimia is a mental disorder characterized by binge eating fol-
lowed by inappropriate compensatory behaviors to avoid weight gain, such as induced vomiting.
23 As confirmed by Dr. Dietz, anorexia is a mental disorder in which an individual refuses to
maintain a minimally normal body weight, is phobic regarding weight gain, and exhibits a dis-
turbance in perception of the shape or size of his or her body.
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48 134 UNITED STATES TAX COURT REPORTS (34)
OPINION
I. Medical Expense Deductions Under Section 213
A. In General
Section 213(a) allows a deduction for expenses paid during
the taxable year for medical care that are not compensated
for by insurance or otherwise and to the extent that such
expenses exceed 7.5 percent of adjusted gross income. 24 In
addition, section 213(d)(1)(B) and (2) provides that certain
amounts paid for transportation and lodging, respectively,
may qualify as amounts paid for medical care under section
213(a) if a taxpayer’s travel away from home is primarily for
and essential to receiving medical care. 25
B. Definition of Medical Care
Congress first provided an income tax deduction for med-
ical expenses in 1942. See Revenue Act of 1942, ch. 619, sec.
127(a), 56 Stat. 825. The original provision was codified as
section 23(x) of the 1939 Internal Revenue Code and read as
follows:
SEC. 23. DEDUCTIONS FROM GROSS INCOME.
In computing net income there shall be allowed as deductions:
* * * * * * *
(x) MEDICAL, DENTAL, ETC., EXPENSES.—Except as limited under para-
graph (1) or (2), expenses paid during the taxable year * * * for medical
care of the taxpayer * * *. The term ‘‘medical care’’, as used in this sub-
section, shall include amounts paid for the diagnosis, cure, mitigation,
treatment, or prevention of disease, or for the purpose of affecting any
structure or function of the body * * *.
At the time, the Senate Committee on Finance commented
on the new deduction for medical expenses in relevant part
as follows:
24 Sec. 213(b) provides that amounts paid for a prescribed drug are treated as amounts paid
for medical care. The parties have stipulated that the feminizing hormones petitioner purchased
in 2001 were a prescribed drug within the meaning of sec. 213(b) and (d)(3), but respondent
does not stipulate that the hormones were for the treatment of an illness or disease within the
meaning of sec. 213.
25 The parties have stipulated that if any part of petitioner’s sex reassignment surgery is de-
termined by the Court to be deductible under sec. 213, then petitioner’s travel and lodging costs
incurred in connection with her consultation and surgery by Dr. Meltzer are also deductible.
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(34) O’DONNABHAIN v. COMMISSIONER 49
The term ‘‘medical care’’ is broadly defined to include amounts paid for
the diagnosis, cure, mitigation, treatment, or prevention of disease, or for
the purpose of affecting any structure or function of the body. It is not
intended, however, that a deduction should be allowed for any expense
that is not incurred primarily for the prevention or alleviation of a physical
or mental defect or illness.
S. Rept. 1631, 77th Cong., 2d sess. 95–96 (1942), 1942–2 C.B.
504, 576–577 (emphasis added); see Stringham v. Commis-
sioner, 12 T.C. 580, 583–584 (1949) (medical care is defined
in broad and comprehensive language, but it does not include
items which are primarily nondeductible personal living
expenses), affd. 183 F.2d 579 (6th Cir. 1950).
The core definition of ‘‘medical care’’ originally set forth in
section 23(x) of the 1939 Code has endured over time and is
currently found in section 213(d)(1)(A), which provides as fol-
lows:
SEC. 213 (d). DEFINITIONS.—For purposes of this section—
(1) The term ‘‘medical care’’ means amounts paid—
(A) for the diagnosis, cure, mitigation, treatment, or prevention of
disease, or for the purpose of affecting any structure or function of the
body * * *
Thus, since the inception of the medical expense deduction,
the definition of deductible ‘‘medical care’’ has had two
prongs. The first prong covers amounts paid for the ‘‘diag-
nosis, cure, mitigation, treatment, or prevention of disease’’
and the second prong covers amounts paid ‘‘for the purpose
of affecting any structure or function of the body’’.
The regulations interpreting the statutory definition of
medical care echo the description of medical care in the
Senate Finance Committee report accompanying the original
enactment. The regulations state in relevant part:
(e) Definitions—(1) General. (i) The term ‘‘medical care’’ includes the
diagnosis, cure, mitigation, treatment, or prevention of disease. Expenses
paid for ‘‘medical care’’ shall include those paid for the purpose of affecting
any structure or function of the body or for transportation primarily for
and essential to medical care. * * *
(ii) * * * Deductions for expenditures for medical care allowable under
section 213 will be confined strictly to expenses incurred primarily for the
prevention or alleviation of a physical or mental defect or illness. * * *
[Sec. 1.213–1(e)(1), Income Tax Regs.; emphasis added.]
Notably, the regulations, mirroring the language of the
Finance Committee report, treat ‘‘disease’’ as used in the
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50 134 UNITED STATES TAX COURT REPORTS (34)
statute as synonymous with ‘‘a physical or mental defect or
illness.’’ The language equating ‘‘mental defect’’ with ‘‘dis-
ease’’ was in the first version of the regulations promulgated
in 1943 and has stood unchanged since. See T.D. 5234, 1943
C.B. 119, 130. In addition, to qualify as ‘‘medical care’’ under
the regulations, an expense must be incurred ‘‘primarily’’ for
alleviation of a physical or mental defect, and the defect
must be specific. ‘‘[A]n expenditure which is merely beneficial
to the general health of an individual, such as an expendi-
ture for a vacation, is not an expenditure for medical care.’’
Sec. 1.213–1(e)(1)(ii), Income Tax Regs.
Given the reference to ‘‘mental defect’’ in the legislative
history and the regulations, it has also long been settled that
‘‘disease’’ as used in section 213 can extend to mental dis-
orders. See, e.g., Fischer v. Commissioner, 50 T.C. 164, 173
n.4 (1968) (‘‘That mental disorders can be ‘disease’ within the
meaning of [section 213(d)(1)(A)] is no longer open to ques-
tion.’’); Starrett v. Commissioner, 41 T.C. 877 (1964);
Hendrick v. Commissioner, 35 T.C. 1223 (1961).
In Jacobs v. Commissioner, 62 T.C. 813 (1974), this Court
reviewed the legislative history of section 213 and syn-
thesized the caselaw to arrive at a framework for analysis of
disputes concerning medical expense deductions. Noting that
the medical expense deduction essentially carves a limited
exception out of the general rule of section 262 that ‘‘per-
sonal, living, or family expenses’’ are not deductible, the
Court observed that a taxpayer seeking a deduction under
section 213 must show: (1) ‘‘the present existence or
imminent probability of a disease, defect or illness—mental
or physical’’ and (2) a payment ‘‘for goods or services directly
or proximately related to the diagnosis, cure, mitigation,
treatment, or prevention of the disease or illness.’’ Id. at 818.
Moreover, where the expenditures are arguably not ‘‘wholly
medical in nature’’ and may serve a personal as well as med-
ical purpose, they must also pass a ‘‘but for’’ test: the tax-
payer must ‘‘prove both that the expenditures were an essen-
tial element of the treatment and that they would not have
otherwise been incurred for nonmedical reasons.’’ Id. at
819. 26
26 Applying the foregoing principles, the Court in Jacobs v. Commissioner, 62 T.C. 813 (1974),
concluded that the expenses of the taxpayer’s divorce, even though the divorce was rec-
ommended by the taxpayer’s psychiatrist and was beneficial to the taxpayer’s mental health,
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(34) O’DONNABHAIN v. COMMISSIONER 51
C. Definition of Cosmetic Surgery
The second prong of the statutory definition of ‘‘medical
care’’, concerning amounts paid ‘‘for the purpose of affecting
any structure or function of the body’’, was eventually
adjudged too liberal by Congress. The Internal Revenue
Service, relying on the second prong, had determined in two
revenue rulings that deductions were allowed for amounts
expended for cosmetic procedures (such as facelifts, hair
transplants, and hair removal through electrolysis) because
the procedures were found to affect a structure or function of
the body within the meaning of section 213(d)(1)(A). See Rev.
Rul. 82–111, 1982–1 C.B. 48 (hair transplants and hair
removal); Rev. Rul. 76–332, 1976–2 C.B. 81 (facelifts); see
also Mattes v. Commissioner, 77 T.C. 650 (1981) (hair trans-
plants to treat premature baldness deductible under section
213).
In 1990 Congress responded to these rulings by amending
section 213 to include new subsection (d)(9) which, generally
speaking, excludes cosmetic surgery from the definition of
deductible medical care. See Omnibus Budget Reconciliation
Act of 1990, Pub. L. 101–508, sec. 11342(a), 104 Stat. 1388–
471. A review of the legislative history of section 213(d)(9)
shows that Congress deemed the amendment necessary to
clarify that deductions for medical care do not include
amounts paid for ‘‘an elective, purely cosmetic treatment’’. H.
Conf. Rept. 101–964, at 1031 (1990), 1991–2 C.B. 560, 562;
see also 136 Cong. Rec. 30485, 30570 (1990) (Senate Finance
Committee report language on Omnibus Budget Reconcili-
ation Act of 1990). 27
were not deductible medical expenses because the divorce would have been undertaken even ab-
sent the taxpayer’s depression.
27 The bill as initially passed in the House of Representatives did not include a provision ad-
dressing cosmetic surgery; this provision originated in the Senate. The report of the Senate Fi-
nance Committee, which was informally printed in the Congressional Record, contrasted ‘‘cos-
metic’’ procedures with ‘‘medically necessary procedures’’ as follows:
For purposes of the medical expense deduction, the IRS generally does not distinguish between
procedures which are medically necessary and those which are purely cosmetic.
* * * * * * *
* * * Expenses for purely cosmetic procedures that are not medically necessary are, in essence,
voluntary personal expenses, which like other personal expenditures (e.g., food and clothing)
generally should not be deductible in computing taxable income.
* * * * * * *
Continued
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52 134 UNITED STATES TAX COURT REPORTS (34)
Section 213(d)(9) defines ‘‘cosmetic surgery’’ as follows:
SEC. 213(d). DEFINITIONS.—For purposes of this section—
* * * * * * *
(9) COSMETIC SURGERY.—
(A) IN GENERAL.—The term ‘‘medical care’’ does not include cosmetic
surgery or other similar procedures, unless the surgery or procedure
is necessary to ameliorate a deformity arising from, or directly related
to, a congenital abnormality, a personal injury resulting from an
accident or trauma, or disfiguring disease.
(B) COSMETIC SURGERY DEFINED.—For purposes of this paragraph,
the term ‘‘cosmetic surgery’’ means any procedure which is directed at
improving the patient’s appearance and does not meaningfully pro-
mote the proper function of the body or prevent or treat illness or dis-
ease.
In sum, section 213(d)(9)(A) provides the general rule that
the term ‘‘medical care’’ does not include ‘‘cosmetic surgery’’
(as defined) unless the surgery is necessary to ameliorate
deformities of various origins. Section 213(d)(9)(B) then
defines ‘‘cosmetic surgery’’ as any procedure that is directed
at improving the patient’s appearance but excludes from the
definition any procedure that ‘‘meaningfully [promotes] the
proper function of the body’’ or ‘‘[prevents] or [treats] illness
or disease’’. There appear to be no cases of precedential value
interpreting the cosmetic surgery exclusion of section
213(d)(9). 28
II. The Parties’ Positions
Respondent contends that petitioner’s hormone therapy,
sex reassignment surgery, and breast augmentation surgery
are nondeductible ‘‘cosmetic surgery or other similar proce-
dures’’ 29 under section 213(d)(9) because they were directed
at improving petitioner’s appearance and did not treat an ill-
ness or disease, meaningfully promote the proper function of
the body, or ameliorate a deformity. Although respondent
* * * [U]nder the provision, procedures such as hair removal electrolysis, hair transplants,
lyposuction [sic], and facelift operations generally are not deductible. In contrast, expenses for
procedures that are medically necessary to promote the proper function of the body and only
incidentally affect the patient’s appearance or expenses for the treatment of a disfiguring condi-
tion arising from a congenital abnormality, personal injury or trauma, or disease (such as recon-
structive surgery following removal of a malignancy) continue to be deductible * * *.
28 Al-Murshidi v. Commissioner, T.C. Summary Opinion 2001–185, construed sec. 213(d)(9)
but was decided under sec. 7463 and may not be treated as precedent. See sec. 7463(b).
29 Respondent contends that petitioner’s hormone therapy was a ‘‘similar procedure’’ within
the meaning of sec. 213(d)(9)(A).
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(34) O’DONNABHAIN v. COMMISSIONER 53
concedes that GID is a mental disorder, respondent contends,
relying on the expert testimony of Dr. Dietz, that GID is not
a disease for purposes of section 213 because it does not arise
from an organic pathology within the human body that
reflects ‘‘abnormal structure or function of the body at the
gross, microscopic, molecular, biochemical, or neurochemical
levels.’’ Respondent further contends that the procedures at
issue did not treat disease because there is no scientific proof
of their efficacy in treating GID and that the procedures were
cosmetic surgery because they were not medically necessary.
Finally, respondent contends that petitioner did not have
GID, that it was incorrectly diagnosed, and that therefore the
procedures at issue did not treat a disease.
Petitioner maintains that she is entitled to deduct the cost
of the procedures at issue on the grounds that GID is a well-
recognized mental disorder in the psychiatric field that ‘‘falls
squarely within the meaning of ‘disease’ because it causes
serious, clinically significant distress and impairment of
functioning.’’ Since widely accepted standards of care pre-
scribe hormone treatment, sex reassignment surgery, and, in
appropriate circumstances, breast augmentation surgery for
genetic males suffering from GID, expenditures for the fore-
going constitute deductible ‘‘medical care’’ because a direct or
proximate relationship exists between the expenditures and
the ‘‘diagnosis, cure, mitigation, treatment, or prevention of
disease’’, petitioner argues. Morever, petitioner contends,
because the procedures at issue treated a ‘‘disease’’ as used
in section 213, they are not ‘‘cosmetic surgery’’ as defined in
that section. 30
III. Analysis
The availability of the medical expense deduction for the
costs of hormonal and surgical sex reassignment for a
transsexual individual presents an issue of first impression.
30 Petitioner also argues that the expenditures for the procedures at issue are deductible be-
cause they affected a structure or function of the body (within the meaning of sec. 213(d)(1)(A))
and were not ‘‘cosmetic surgery’’ under sec. 213(d)(9) because they were not ‘‘directed at improv-
ing the patient’s appearance’’ and because they ‘‘meaningfully [promoted] the proper function
of the body’’ (within the meaning of sec. 213(d)(9)(B)). Given our conclusion, discussed herein-
after, that the expenditures for petitioner’s hormone therapy and sex reassignment surgery are
deductible because they ‘‘[treated] * * * disease’’ within the meaning of sec. 213(d)(1)(A) and
(9)(B), we need not resolve the foregoing issues with respect to those expenditures. We consider
petitioner’s arguments with respect to the breast augmentation surgery more fully infra.
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54 134 UNITED STATES TAX COURT REPORTS (34)
A. Statutory Definitions
Determining whether sex reassignment procedures are
deductible ‘‘medical care’’ or nondeductible ‘‘cosmetic surgery’’
starts with the meaning of ‘‘treatment’’ and ‘‘disease’’ as used
in section 213. Both the statutory definition of ‘‘medical care’’
and the statute’s exclusion of ‘‘cosmetic surgery’’ from that
definition depend in part upon whether an expenditure or
procedure is for ‘‘treatment’’ of ‘‘disease’’. Under section
213(d)(1)(A), if an expenditure is ‘‘for the * * * treatment
* * * of disease’’, it is deductible ‘‘medical care’’; under sec-
tion 213(d)(9)(B), if a procedure ‘‘[treats] * * * disease’’, it is
not ‘‘cosmetic surgery’’ that is excluded from the definition of
‘‘medical care’’. 31
Because the only difference between the quoted phrases in
these two subparagraphs is the use of the noun form ‘‘treat-
ment’’ versus the verb form ‘‘treat’’, we see no meaningful
distinction between them. ‘‘Code provisions generally are to
be interpreted so congressional use of the same words
indicates an intent to have the same meaning apply’’. Elec.
Arts, Inc. v. Commissioner, 118 T.C. 226, 241 (2002); see also
Commissioner v. Keystone Consol. Indus., Inc., 508 U.S. 152,
159 (1993); United States v. Olympic Radio & Television,
Inc., 349 U.S. 232, 236 (1955); Zuanich v. Commissioner, 77
T.C. 428, 442–443 (1981). Consequently, the determination of
whether something is a ‘‘treatment’’ of a ‘‘disease’’ is the
same throughout section 213, whether for purposes of
showing that an expenditure is for ‘‘medical care’’ under sec-
tion 213(d)(1)(A) or that a procedure is not ‘‘cosmetic surgery’’
under section 213(d)(9)(B). A showing that a procedure con-
stitutes ‘‘treatment’’ of a ‘‘disease’’ both precludes ‘‘cosmetic
surgery’’ classification under section 213(d)(9) and qualifies
the procedure as ‘‘medical care’’ under section 213(d)(1)(A). 32
31 As noted, respondent contends that petitioner’s hormone therapy is a ‘‘similar procedure’’
within the meaning of the sec. 213(d)(9)(A) exclusion from ‘‘medical care’’ of ‘‘cosmetic surgery
or other similar procedures’’. Respondent does not contend, however, that the hormone therapy’s
status as a ‘‘similar procedure’’ within the meaning of sec. 213(d)(9)(A) ipso facto causes the
therapy to be excluded from ‘‘medical care’’. Instead, by arguing that the hormone therapy was
directed at improving petitioner’s appearance and did not treat an illness or disease, respondent
concedes that a ‘‘similar procedure’’ as used in sec. 213(d)(9)(A) is delimited by the definition
of ‘‘cosmetic surgery’’ in sec. 213(d)(9)(B)—that is, that a ‘‘similar procedure’’ is excluded from
the definition of ‘‘medical care’’ if it ‘‘is directed at improving the patient’s appearance and does
not meaningfully promote the proper function of the body or prevent or treat illness or disease’’.
32 The parties have stipulated that petitioner did not undertake hormone therapy or sex reas-
signment surgery to ameliorate a deformity arising from, or directly related to, a personal injury
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(34) O’DONNABHAIN v. COMMISSIONER 55
Congress’ reuse of the terms ‘‘treat’’ and ‘‘disease’’ in
defining ‘‘cosmetic surgery’’ in section 213(d)(9)(B) triggers a
second principle of statutory construction. Given that the
phrase ‘‘treatment * * * of disease’’ as used in the section
213(d)(1)(A) definition of ‘‘medical care’’ had been the subject
of considerable judicial and administrative construction when
Congress incorporated the phrase into the definition of ‘‘cos-
metic surgery’’ in 1990, it ‘‘had acquired a settled judicial and
administrative interpretation’’. Commissioner v. Keystone
Consol. Indus., Inc., supra at 159. In these circumstances ‘‘it
is proper to accept the already settled meaning of the
phrase’’. Id. Therefore, the pre-1990 caselaw and regulations
construing ‘‘treatment’’ and ‘‘disease’’ for purposes of the sec-
tion 213(d)(1)(A) definition of ‘‘medical care’’ are applicable to
the interpretation of those words as used in the section
213(d)(9)(B) definition of ‘‘cosmetic surgery’’.
B. Is GID a ‘‘Disease’’?
Petitioner argues that she is entitled to deduct her
expenditures for the procedures at issue because they were
treatments for GID, a condition that she contends is a ‘‘dis-
ease’’ for purposes of section 213. Respondent maintains that
petitioner’s expenditures did not treat ‘‘disease’’ because GID
is not a ‘‘disease’’ within the meaning of section 213. Central
to his argument is respondent’s contention that ‘‘disease’’ as
used in section 213 has the meaning postulated by respond-
ent’s expert, Dr. Dietz; namely, ‘‘a condition * * * [arising]
as a result of a pathological process * * * [occurring] within
the individual and [reflecting] abnormal structure or function
of the body at the gross, microscopic, molecular, biochemical,
or neuro-chemical levels.’’
On brief respondent cites the foregoing definition from Dr.
Dietz’ expert report and urges it upon the Court as the
meaning of ‘‘disease’’ as used in section 213; namely, that a
‘‘disease’’ for this purpose must have a demonstrated organic
or physiological origin in the individual. Consequently, GID is
arising from an accident or trauma, or a disfiguring disease. Petitioner has neither argued nor
adduced evidence that the foregoing procedures ameliorated a deformity arising from, or directly
related to, a congenital abnormality. See sec. 213(d)(9)(A). We consider petitioner’s arguments
concerning the breast augmentation surgery more fully infra.
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56 134 UNITED STATES TAX COURT REPORTS (34)
not a ‘‘disease’’ because it has ‘‘no known organic pathology’’,
respondent argues. 33
However, this use of expert testimony to establish the
meaning of a statutory term is generally improper. ‘‘[E]xpert
testimony proffered solely to establish the meaning of a law
is presumptively improper.’’ United States v. Prigmore, 243
F.3d 1, 18 n.3 (1st Cir. 2001). The meaning of a statutory
term is a pure question of law that is ‘‘exclusively the domain
of the judge.’’ Nieves-Villanueva v. Soto-Rivera, 133 F.3d 92,
99 (1st Cir. 1997); see also United States v. Mikutowicz, 365
F.3d 65, 73 (1st Cir. 2004); Bammerlin v. Navistar Intl.
Transp. Corp., 30 F.3d 898, 900 (7th Cir. 1994); Snap-Drape,
Inc. v. Commissioner, 105 T.C. 16, 19–20 (1995), affd. 98 F.3d
194, 198 (5th Cir. 1996). Closely analogous is S. Jersey Sand
Co. v. Commissioner, 30 T.C. 360, 364 (1958), affd. 267 F.2d
591 (3d Cir. 1959), where this Court refused to consider the
expert testimony of a geologist concerning the meaning of the
term ‘‘quartzite’’ as used in the Internal Revenue Code.
While the Court admitted Dr. Dietz’ expert report and
allowed him to testify over petitioner’s objection, the use to
which respondent now seeks to put his testimony is
improper, and we disregard it for that purpose. 34 The
meaning of ‘‘disease’’ as used in section 213 must be resolved
by the Court, using settled principles of statutory construc-
tion, including reference to the Commissioner’s interpretive
regulations, the legislative history, and caselaw precedent. 35
As a legal argument for the proper interpretation of ‘‘dis-
ease’’, respondent’s position is meritless. Respondent cites no
authority, other than Dr. Dietz’ expert testimony, in support
of his interpretation, and we have found none. To the con-
trary, respondent’s interpretation is flatly contradicted by
nearly a half century of caselaw. Numerous cases have
treated mental disorders as ‘‘diseases’’ for purposes of section
213 without regard to any demonstrated organic or physio-
logical origin or cause. See Fay v. Commissioner, 76 T.C. 408
33 The experts all agree and the Court accepts, for purposes of deciding this case, that no or-
ganic or biological cause of GID has been demonstrated.
34 In contrast, the testimony of the other two experts presents specialized medical knowledge
concerning the nature of GID. These facts bear upon whether GID should be considered to qual-
ify as a ‘‘disease’’, as the Court interprets that term.
35 Dr. Dietz’ testimony as a forensic psychiatrist is proper and useful regarding other matters,
such as the state of knowledge concerning organic origins of mental conditions, and the Court
relies on the testimony for certain other purposes, as discussed infra.
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(34) O’DONNABHAIN v. COMMISSIONER 57
(1981); Jacobs v. Commissioner, 62 T.C. 818; Fischer v.
Commissioner, 50 T.C. 164 (1968); Starrett v. Commissioner,
41 T.C. 877 (1964); Hendrick v. Commissioner, 35 T.C. 1223
(1961); Sims v. Commissioner, T.C. Memo. 1979–499. These
cases found mental conditions to be ‘‘diseases’’ where there
was evidence that mental health professionals regarded the
condition as creating a significant impairment to normal
functioning and warranting treatment. This Court’s discus-
sion in Fay v. Commissioner, supra at 414–415, is represent-
ative:
While the record is not too clear with respect to the precise nature of the
mental conditions of * * * [the taxpayer’s children], we are satisfied that
they both suffered from some sort of learning disability, accompanied by
emotional stress, which prevented, or at least interfered with, their ability
to cope in a normal academic environment. While this condition may or
may not have been psychiatric, it was certainly a mental handicap or
defect which we think may be considered a mental disease or defect for
purposes of section 213. It was the type of disorder that the petitioners,
their expert educational consultants, a psychiatrist, and the staff of the
DLD program[36] thought could be mitigated or alleviated, or possibly
cured, by the special attention and individual programing given to the chil-
dren at the DLD. While these mental disorders may not have been severe
enough to require psychiatric or psychological treatment, they were severe
enough to prevent the children from acquiring a normal education without
some help, and we think any treatment, whether rendered by medical
people or specially trained educators, directly related to the alleviation of
such mental disorders so that the recipient may obtain a normal, or more
normal, education, qualifies as medical care under the statute.
In Fischer v. Commissioner, supra at 173–174, there was a
similar absence of any discussion of organic or physiological
origins in this Court’s analysis of the ‘‘conventional meaning’’
of ‘‘disease’’.
The first question presented is whether petitioner’s son, Don, was suffering
from a ‘‘disease’’ as that term is used in the statute and the applicable
regulation. Given that term its conventional meaning, we think the evi-
dence is clear * * * that Don was suffering from a disease when he
entered Oxford Academy. As detailed in our findings, the report of the
Institute of the Pennsylvania Hospital states that as of that date Don had
‘‘not evolved the usual ‘defense’ or integrating mechanisms necessary for
dealing maturely, realistically and in an organized fashion, with the prob-
lems of his environment. * * * ’’ * * * a psychiatrist who treated Don for
36 The DLD program refers to the department of language development program, a special
program at the taxpayer’s children’s school for children with learning disabilities. Fay v. Com-
missioner, 76 T.C. 408, 410 (1981).
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58 134 UNITED STATES TAX COURT REPORTS (34)
almost a year, described him as a child with ‘‘significant neurotic blocks
against learning.’’ * * * [Fn. ref. omitted.]
See also Jacobs v. Commissioner, supra at 818 (taxpayer’s
‘‘severe depression’’ as evidenced by his psychiatrist’s testi-
mony is ‘‘disease’’ for purposes of section 213); Hendrick v.
Commissioner, supra at 1236 (‘‘emotional insecurity’’ of child
is a ‘‘disease’’ for purposes of section 213); Sims v. Commis-
sioner, supra (‘‘disease’’ for purposes of section 213 found
although ‘‘record does not contain a precise characterization
of * * * [the taxpayer’s son’s] condition in medical termi-
nology, there is ample evidence to support a finding that he
suffered from some sort of learning disability, accompanied
by emotional or psychiatric problems’’). We have also consid-
ered a condition’s listing in a diagnostic reference text as
grounds for treating the condition as a ‘‘disease’’, without
inquiry into the condition’s etiology. In Starrett v. Commis-
sioner, supra at 878 & n.1, 880–882, a reviewed Opinion, we
treated ‘‘anxiety reaction’’ as a ‘‘disease’’ for purposes of sec-
tion 213, pointing to the condition’s recognition in the Amer-
ican Medical Association’s Standard Nomenclature of Dis-
eases and Operations (5th ed. 1961).
The absence of any consideration of etiology in the caselaw
is consistent with the legislative history and the regulations.
Both treat ‘‘disease’’ as synonymous with ‘‘a physical or
mental defect’’, which suggests a more colloquial sense of the
term ‘‘disease’’ was intended than the narrower (and more
rigorous) interpretation for which respondent contends.
In addition, in the context of mental disorders, it is vir-
tually inconceivable that Congress could have intended to
confine the coverage of section 213 to conditions with dem-
onstrated organic origins when it enacted the provision in
1942, because physiological origins for mental disorders were
not widely recognized at the time. As Dr. Dietz confirmed in
his testimony, the physiological origins of various well-recog-
nized mental disorders—for example, panic disorder and
obsessive-compulsive disorder—were discovered only about a
decade ago. Moreover, Dr. Dietz confirmed that bulimia
would not constitute a ‘‘disease’’ under his definition, because
bulimia has no demonstrated organic origin, nor would post-
traumatic stress disorder. Dr. Dietz was unable to say
whether anorexia would meet the definition because he was
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(34) O’DONNABHAIN v. COMMISSIONER 59
uncertain regarding the current state of scientific knowledge
of its origins. Petitioner’s expert, Dr. Brown, testified without
challenge that most mental disorders listed in the DSM–IV–TR
do not have demonstrated organic causes. Thus, under the
definition of ‘‘disease’’ respondent advances, many well-recog-
nized mental disorders, perhaps most, would be excluded
from coverage under section 213—a result clearly at odds
with the intent of Congress (and the regulations) to provide
deductions for the expenses of alleviating ‘‘mental defects’’
generally.
In sum, we reject respondent’s interpretation of ‘‘disease’’
because it is incompatible with the stated intent of the regu-
lations and legislative history to cover ‘‘mental defects’’ gen-
erally and is contradicted by a consistent line of cases finding
‘‘disease’’ in the case of mental disorders without regard to
any demonstrated etiology.
Having rejected respondent’s contention that ‘‘disease’’ as
used in section 213 requires a demonstrated organic origin,
we are left with the question whether the term should be
interpreted to encompass GID. On this score, respondent,
while conceding that GID is a mental disorder, argues that
GID is ‘‘not a significant psychiatric disorder’’ but instead is
a ‘‘social construction’’—a ‘‘social phenomenon’’ that has been
‘‘medicalized’’. Petitioner argues that GID is a ‘‘disease’’ for
purposes of section 213 because it is well recognized in main-
stream psychiatric literature, including the DSM–IV–TR, as a
legitimate mental disorder that ‘‘causes serious, clinically
significant distress and impairment of functioning’’.
For the reasons already noted and those discussed below,
we conclude that GID is a ‘‘disease’’ within the meaning of
section 213. We start with the two caselaw factors influ-
encing a finding of ‘‘disease’’ in the context of mental condi-
tions: (1) A determination by a mental health professional
that the condition created a significant impairment to normal
functioning, warranting treatment, see Fay v. Commissioner,
76 T.C. 408 (1981); Jacobs v. Commissioner, 62 T.C. 813
(1974); Fischer v. Commissioner, 50 T.C. 164 (1968);
Hendrick v. Commissioner, 35 T.C. 1223 (1961), or (2) a
listing of the condition in a medical reference text, see
Starrett v. Commissioner, 41 T.C. 877 (1964). Both factors
involve deference by a court to the judgment of medical
professionals.
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60 134 UNITED STATES TAX COURT REPORTS (34)
As noted in our findings, GID is listed as a mental disorder
in the DSM–IV–TR, which all three experts agree is the pri-
mary diagnostic tool of American psychiatry. 37 See also
Danaipour v. McLarey, 286 F.3d 1, 17 (1st Cir. 2002)
(characterizing the DSM–IV as ‘‘the leading psychiatric diag-
nostic manual’’). GID or transsexualism is also listed in
numerous medical reference texts, with descriptions of their
characteristics that are similar to those in the DSM–IV–TR. 38
See Starrett v. Commissioner, supra.
Even if one accepts respondent’s expert Dr. Schmidt’s
assertion that the validity of the GID diagnosis is subject to
some debate in the psychiatric profession, the widespread
recognition of the condition in medical literature persuades
the Court that acceptance of the GID diagnosis is the pre-
vailing view. Dr. Schmidt’s own professed misgivings about
the diagnosis are not persuasive, given that he continues to
employ the diagnosis in practice, believes that psychiatrists
must be familiar with it, and recently gave a GID diagnosis
as an expert in another court proceeding. 39 On balance, the
37 We recognize that the DSM–IV–TR cautions that inclusion of a diagnostic category therein
‘‘does not imply that the condition meets legal or other non-medical criteria for what constitutes
mental disease, mental disorder, or mental disability.’’ For purposes of our decision in this case,
GID’s inclusion in the DSM–IV–TR (and its predecessors) evidences widespread recognition of
the condition in the psychiatric profession. Indisputably, the issue of whether GID is a ‘‘disease’’
for purposes of sec. 213 is for this Court to decide, and we do so on the basis of a range of fac-
tors, including GID’s inclusion in the DSM–IV–TR.
38 See, e.g., American Medical Association, Complete Medical Encyclopedia 595, 1234 (Random
House 2003); The Dictionary of Medical Terms 157 (4th ed. 2004); Dorland’s Illustrated Medical
Dictionary, http://www.mercksource.com/pp/us/cnslhlldorlands; ‘‘Gender Identity Disorder
and Transsexualism’’, Merck Manuals Online Medical Library, http://www.merck.com./mmpe/
print/sec15/ch203/ch203b.html; Miller-Keane Encyclopedia and Dictionary of Medicine, Nursing,
and Allied Health 728, 1808 (2003); National Institutes of Health, U.S. National Library of Med-
icine, MedlinePlus Medical Encyclopedia, http://nlm.nih.gov/medlineplus/ency/article/
001527.html; Sloane-Dorland Annotated Medical-Legal Dictionary 202–203, 233, 291, 310, 744
(1987).
Transsexualism is also listed and described in the International Classification of Diseases,
Ninth Revision, Clinical Modification (6th ed.) a publication of the American Medical Association
used in the United States for assigning codes to various diagnoses and procedures. Similarly,
various gender identity disorders, including transsexualism, are listed and described in the
International Classification of Diseases, Tenth Revision, a 1992 publication of the World Health
Organization that classifies diseases and health related problems.
Respondent stresses on brief that he stipulated that the foregoing publications were medical
reference texts but did not stipulate the truth of their contents. Except where otherwise indi-
cated, we consider medical reference texts solely for the fact that they recognize GID or
transsexualism and treatments for the condition.
39 Dr. Schmidt attributed his misgivings in part to the ‘‘lack of a scientifically supported eti-
ology of the condition’’, but as petitioner’s expert Dr. Brown pointed out, the same could be said
of most mental disorders listed in the DSM.
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(34) O’DONNABHAIN v. COMMISSIONER 61
evidence amply demonstrates that GID is a widely recognized
and accepted diagnosis in the field of psychiatry.
Second, GID is a serious, psychologically debilitating condi-
tion. Respondent’s characterization of the condition on brief
as a ‘‘social construction’’ and ‘‘not a significant psychiatric
disorder’’ is undermined by both of his own expert witnesses
and the medical literature in evidence. All three expert wit-
nesses agreed that, absent treatment, GID in genetic males is
sometimes associated with autocastration, autopenectomy,
and suicide. Respondent’s expert Dr. Schmidt asserts that
remaining ambiguous about gender identity ‘‘will tear you
apart psychologically’’. Petitioner’s expert Dr. Brown likewise
testified that GID produces significant distress and
maladaption. Psychiatric reference texts, established as reli-
able authority by Dr. Brown’s testimony, confirm the fore-
going. See Fed. R. Evid. 803(18). One such text states:
Cross-gender identity (gender identity contradicted by anatomical sex
characteristics) in adulthood virtually always causes distress to the indi-
vidual. * * * Cross-gender identity at any age, therefore, is appropriately
regarded as a disorder and a possible reason for clinical intervention.
* * * [Green & Blanchard, ‘‘Gender Identity Disorders’’, in Kaplan &
Sadock’s Comprehensive Textbook of Psychiatry 1646, 1659 (Sadock &
Sadock, eds., 2000).]
Another psychiatric reference text states that ‘‘Prior to rec-
ognition of transsexualism as a disorder deserving medical
and psychiatric attention many patients self-mutilated or
committed suicide out of despair.’’ Green, ‘‘Gender Identity
Disorder in Adults’’, in New Oxford Textbook of Psychiatry
914 (Gelder, et al., eds., 2000).
Ms. Ellaborn concluded that petitioner exhibited clinically
significant impairment from GID, to the extent that she des-
ignated petitioner’s condition as ‘‘severe’’ under the DSM–IV–
TR standards. Her diagnosis was supported by another doc-
toral-level mental health professional and by Dr. Brown. The
severity of petitioner’s impairment, coupled with the near
universal recognition of GID in diagnostic and other medical
reference texts, bring petitioner’s condition in line with the
circumstances where a mental condition has been deemed a
‘‘disease’’ in the caselaw under section 213.
Third, respondent’s position that GID is not a significant
psychiatric disorder is at odds with the position of every U.S.
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62 134 UNITED STATES TAX COURT REPORTS (34)
Court of Appeals that has ruled on the question of whether
GID poses a serious medical need for purposes of the Eighth
Amendment, which has been interpreted to require that pris-
oners receive adequate medical care. See Estelle v. Gamble,
429 U.S. 97, 103 (1976). In Estelle v. Gamble, supra at 104,
the U.S. Supreme Court held that ‘‘deliberate indifference to
serious medical needs of prisoners constitutes the ‘unneces-
sary and wanton infliction of pain’ * * * proscribed by the
Eighth Amendment.’’ The U.S. Courts of Appeals have
accordingly interpreted Estelle v. Gamble, supra, as estab-
lishing a two-prong test for an Eighth Amendment violation:
it must be shown that (1) the prisoner had a ‘‘serious medical
need’’ which (2) was met with ‘‘deliberate indifference’’ by
prison officials. See, e.g., Cuoco v. Moritsugu, 222 F.3d 99,
106 (2d Cir. 2000) (applying the Eighth Amendment test to
a pretrial detainee); White v. Farrier, 849 F.2d 322, 325–327
(8th Cir. 1988).
Seven of the U.S. Courts of Appeals that have considered
the question have concluded that severe GID or
transsexualism constitutes a ‘‘serious medical need’’ for pur-
poses of the Eighth Amendment. See De’lonta v. Angelone,
330 F.3d 630, 634 (4th Cir. 2003); Allard v. Gomez, 9 Fed.
Appx. 793, 794 (9th Cir. 2001); Cuoco v. Moritsugu, supra;
Brown v. Zavaras, 63 F.3d 967, 970 (10th Cir. 1995); Phillips
v. Mich. Dept. of Corr., 932 F.2d 969 (6th Cir. 1991), affg. 731
F. Supp. 792 (W.D. Mich. 1990); White v. Farrier, supra;
Meriwether v. Faulkner, 821 F.2d 408, 411–413 (7th Cir.
1987); see also Maggert v. Hanks, 131 F.3d 670, 671 (7th Cir.
1997) (describing gender dysphoria as a ‘‘profound psychiatric
disorder’’). 40 No U.S. Court of Appeals has held otherwise. 41
Deliberate indifference ‘‘requires that a prison official actu-
ally know of and disregard an objectively serious condition,
medical need, or risk of harm.’’ De’lonta v. Angelone, supra
at 634. Many of the foregoing opinions either found that
‘‘deliberate indifference’’ had not been shown or remanded to
40 The U.S. Supreme Court has also treated transsexualism as a serious medical condition,
relying on its listing in the DSM–III and the American Medical Association’s Encyclopedia of
Medicine (1989). See Farmer v. Brennan, 511 U.S. 825, 829 (1994).
41 Two Courts of Appeals have considered, but found it unnecessary to decide, whether GID
or transsexualism constitutes a serious medical need for purposes of the Eighth Amendment.
See Praylor v. Tex. Dept. of Criminal Justice, 430 F.3d 1208 (5th Cir. 2005), withdrawing 423
F.3d 524 (5th Cir. 2005) (holding that transsexualism constitutes a serious medical need for
Eighth Amendment purposes); Farmer v. Moritsugu, 163 F.3d 610, 614–615 (D.C. Cir. 1998).
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(34) O’DONNABHAIN v. COMMISSIONER 63
the District Court for further proceedings regarding that
point, but they reflect a clear consensus that GID constitutes
a medical condition of sufficient seriousness that it triggers
the Eighth Amendment requirement that prison officials not
ignore or disregard it. 42
In view of (1) GID’s widely recognized status in diagnostic
and psychiatric reference texts as a legitimate diagnosis, (2)
the seriousness of the condition as described in learned trea-
tises in evidence and as acknowledged by all three experts in
this case; (3) the severity of petitioner’s impairment as found
by the mental health professionals who examined her; (4) the
consensus in the U.S. Courts of Appeals that GID constitutes
a serious medical need for purposes of the Eighth Amend-
ment, we conclude and hold that GID is a ‘‘disease’’ for pur-
poses of section 213.
C. Did Petitioner Have GID?
Respondent also contends that petitioner was not correctly
diagnosed with GID, citing his expert Dr. Schmidt’s conten-
tions that certain comorbid conditions such as depression or
transvestic fetishism had not been adequately ruled out as
explanations of petitioner’s condition.
We find that petitioner’s GID diagnosis is substantially sup-
ported by the record. Ms. Ellaborn was licensed under State
law to make such a diagnosis. A second licensed professional
concurred, as did petitioner’s expert, a recognized authority
in the field. Ms. Ellaborn’s testimony concerning her diag-
nosis was persuasive. She considered and ruled out comorbid
conditions, including depression and transvestic fetishism,
and she believed her initial diagnosis was confirmed by peti-
tioner’s experience with the steps in the triadic therapy
sequence. 43
42 But see Maggert v. Hanks, 131 F.3d 670 (7th Cir. 1997), where the Court of Appeals for
the Seventh Circuit, after concluding that the plaintiff inmate had failed to establish that he
had gender dysphoria, observed in dicta that since treatment for gender dysphoria is ‘‘protracted
and expensive’’ and the Eighth Amendment does not require that a prisoner be given medical
care ‘‘that is as good as he would receive if he were a free person’’, the Amendment ‘‘does not
entitle a prison inmate to curative treatment for his gender dysphoria.’’ Id. at 671–672.
43 Petitioner’s response to the administration of cross-gender hormones is especially persuasive
regarding the diagnosis. Ms. Ellaborn observed that petitioner’s reaction to the effects of the
hormones was essentially positive; that is, the hormones engendered a sense of well-being and
a calming effect in petitioner—a well-documented phenomenon in genetic males suffering from
GID who receive feminizing hormones, confirmed by both respondent’s and petitioner’s experts.
By contrast, as Dr. Brown observed, when feminizing hormones are administered to non-GID-
Continued
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64 134 UNITED STATES TAX COURT REPORTS (34)
Absent evidence of a patent lack of qualifications, see, e.g.,
Flemming v. Commissioner, T.C. Memo. 1980–583 (rejecting
diagnosis of cancer and kidney disease by dentist), this Court
has generally deferred, in section 213 disputes, to the judg-
ment of the medical professionals who treated the patient,
see, e.g. Fay v. Commissioner, 76 T.C. 414; Jacobs v.
Commissioner, 62 T.C. 818; Fischer v. Commissioner, 50
T.C. 173–174. All three witnesses who supported peti-
tioner’s GID diagnosis interviewed petitioner. Since Dr.
Schmidt did not, his analysis is entitled to considerably less
weight, and we conclude that there is no persuasive basis to
doubt the diagnosis.
D. Whether Cross-Gender Hormones, Sex Reassignment
Surgery, and Breast Augmentation Surgery ‘‘Treat’’
GID
1. Cross-Gender Hormones and Sex Reassignment Surgery
Our conclusions that GID is a ‘‘disease’’ for purposes of sec-
tion 213, and that petitioner suffered from it, leave the ques-
tion of whether petitioner’s hormone therapy, sex reassign-
ment surgery, and breast augmentation surgery ‘‘[treated]’’
GID within the meaning of section 213(d)(1)(A) and (9)(B).
In contrast to their dispute over the meaning of ‘‘disease’’,
the parties have not disputed the meaning of ‘‘treatment’’ or
‘‘treat’’ as used in section 213(d)(1)(A) and (9)(B), respec-
tively. We accordingly interpret the words in their ordi-
nary, everyday sense. See Crane v. Commissioner, 331 U.S.
1, 6 (1947); Old Colony R.R. Co. v. Commissioner, 284 U.S.
552, 560 (1932) (‘‘ ‘The legislature must be presumed to use
words in their known and ordinary signification’ ’’ (quoting
Levy’s Lessee v. M’Cartee, 6 Pet. 102, 110 (1832))); see also
Heard v. Commissioner, 269 F.2d 911, 912 (3d Cir. 1959)
(‘‘The words of * * * [section 213] are to be given their
normal meaning without striving to read exceptions into
them.’’), revg. in part 30 T.C. 1093 (1958).
‘‘Treat’’ is defined in standard dictionaries as: ‘‘to deal with
(a disease, patient, etc.) in order to relieve or cure’’, Webster’s
New Universal Unabridged Dictionary 2015 (2003); ‘‘to care
for or deal with medically or surgically’’, Merriam Webster’s
suffering males (for other medical reasons), and those males experience impotence, widening
hips, and breast development, their response is not a sense of well-being but anxiety.
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(34) O’DONNABHAIN v. COMMISSIONER 65
Collegiate Dictionary 1333 (11th ed. 2008); ‘‘5 a: to care for
(as a patient or part of the body) medically or surgically: deal
with by medical or surgical means: give a medical treatment
to * * * b: to seek cure or relief of * * * ’’, Webster’s Third
New International Dictionary 2435 (2002).
The regulations provide that medical care is confined to
expenses ‘‘incurred primarily for the prevention or alleviation
of a physical or mental defect or illness’’. Sec. 1.213–
1(e)(1)(ii), Income Tax Regs. (emphasis added). A treatment
should bear a ‘‘direct or proximate therapeutic relation to the
* * * condition’’ sufficient ‘‘to justify a reasonable belief the
* * * [treatment] would be efficacious’’. Havey v. Commis-
sioner, 12 T.C. 409, 412 (1949). In Starrett v. Commissioner,
41 T.C. 881, this Court concluded that the taxpayer’s
psychoanalysis was a treatment of disease because the tax-
payer was ‘‘thereby relieved of the physical and emotional
suffering attendant upon’’ the condition known as anxiety
reaction.
Hormone therapy, sex reassignment surgery and, under
certain conditions, breast augmentation surgery are pre-
scribed therapeutic interventions, or treatments, for GID out-
lined in the Benjamin standards of care. The Benjamin
standards are widely accepted in the psychiatric profession,
as evidenced by the recognition of the standards’ triadic
therapy sequence as the appropriate treatment for GID and
transsexualism in numerous psychiatric and medical ref-
erence texts. 44 Indeed, every psychiatric reference text that
has been established as authoritative in this case endorses
sex reassignment surgery as a treatment for GID in appro-
priate circumstances. 45 No psychiatric reference text has
44 See ‘‘Gender Identity’’, Merck Manuals Second Home Edition, http://www.merck.com/mmhe/
print/sec07/ch104/ch104b.html; ‘‘Gender Identity Disorder and Transsexualism’’, Merck Manuals
Online Medical Library, supra; National Institutes of Health, U.S. National Library of Medicine,
Medline Plus Medical Encyclopedia, supra; Senagore & Frey, ‘‘Orchiectomy’’, Gale Encyclopedia
of Surgery (Thomson Gale 2003).
45 The following psychiatric reference texts have been established as learned treatises, see
Fed. R. Evid. 803(18), and endorse the essential elements of the triadic therapy sequence of the
Benjamin standards, including sex reassignment surgery. American Psychiatric Association,
Treatments of Psychiatric Disorders, ch. 70 (3d ed., American Psychiatric Press 2001):
The [Benjamin] ‘‘Standards of Care’’ for treating gender-dysphoric individuals, developed by an
international group of experts [citation omitted] and followed by most responsible professionals
in the field, provides a valuable guide for evaluation and treatment.
* * * * * * *
Continued
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66 134 UNITED STATES TAX COURT REPORTS (34)
been brought to the Court’s attention that fails to list, or
rejects, the triadic therapy sequence or sex reassignment sur-
gery as the accepted treatment regimen for GID. 46 Several
courts have accepted the Benjamin standards as representing
Once a patient has met readiness criteria for referral as outlined in the [Benjamin] Standards
of Care, she must decide on a surgical technique and surgeon. * * *
Becker, et al., ch. 19, ‘‘Sexual and Gender Identity Disorders’’, in The American Psychiatric
Press Textbook of Psychiatry (3d ed.):
Sex reassignment is a long process that must be carefully monitored. * * * If the patient is con-
sidered appropriate for sex reassignment, psychotherapy should be started to prepare the pa-
tient for the cross-gender role. The patient should then go out into the world and live in the
cross-gender role before surgical reassignment. * * * After 1–2 years, if these measures have
been successful and the patient still wishes reassignment, hormone treatment is begun. * * *
After 1–2 years of hormone therapy, the patient may be considered for surgical reassignment
if such a procedure is still desired.
Green, in New Oxford Textbook of Psychiatry, supra at 914–915:
* * * The [Benjamin standards of care] programme includes, in addition to ongoing psychiatric
or psychological monitoring, possibly endocrine therapy and, depending on the outcome of the
graduated trial period of cross-gender living, possibly sex reassignment surgical procedures. The
philosophy of treatment is to do reversible procedures before those that are irreversible.
* * * If patients can demonstrate to themselves and mental health experts that they have suc-
cessfully negotiated the ‘Real Life Test’ and are adjusting better socially in this new gender role,
they can be referred for surgery.
Sadock & Sadock, Kaplan & Sadock’s Comprehensive Textbook of Psychiatry 1659–1660 (7th
ed., Lippincott Williams & Wilkins 2000):
* * * When the patient’s gender dysphoria is severe and intractable, sex reassignment may be
the best solution. The first medical intervention in this process is hormone therapy. * * *
* * * The second major stage in the medical treatment of transsexualism is sex reassignment
surgery. All major gender identity clinics in North America and western Europe require their
patients to live full-time in the cross-gender role for some time—usually 1 to 2 years—prior to
surgery.
Tasman et al., Psychiatry 1491–1492 (2d ed., John Wiley & Sons 2003):
The treatment of * * * [gender identity disorders], although not as well-based on scientific evi-
dence as some psychiatric disorders, has been carefully scrutinized by multidisciplinary commit-
tees of specialists with the Harry Benjamin International Gender Dysphoria Association
[WPATH] for over 20 years. For more details in managing an individual patient, please consult
its ‘‘Standards of Care’’ [citation omitted]. * * *
* * * * * * *
Living in the aspired-to-gender role—working, relating, conducting the activities of daily living—
is a vital process that enables one of three decisions: to abandon the quest, to simply live in
this new role, or to proceed with breast or genital surgery [citation omitted]. * * *
Ideally, hormones should be administered by endocrinologists who have a working relationship
with a mental health team dealing with gender problems. * * *
* * * * * * *
Surgical intervention is the final external step.
46 Respondent offered into evidence a chapter from a psychiatric reference text that respond-
ent claimed did not reference the Benjamin standards of care; namely, Becker, et al., supra.
However, a review of the chapter cited (particularly pp. 743–744) reveals that the Benjamin
triadic sequence—cross-gender hormone therapy, living in the cross-gender role, and sex reas-
signment surgery—is discussed (without naming the Benjamin standards or WPATH specifi-
cally) and endorsed as the appropriate treatment protocol, as set out supra note 45.
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(34) O’DONNABHAIN v. COMMISSIONER 67
the consensus of the medical profession regarding the appro-
priate treatment for GID or transsexualism. See Gammett v.
Idaho State Bd. of Corr., No. CV05–257–S–MHW (D. Idaho,
July 27, 2007) (memorandum decision and order); Houston v.
Trella, No. 2:04–CV–01393 (D.N.J., Sept. 25, 2006) (opinion);
Kosilek v. Maloney, 221 F. Supp. 2d 156, 158 (D. Mass. 2002);
Farmer v. Hawk-Sawyer, 69 F. Supp. 2d 120, 121 n.3 (D.D.C.
1999).
Nonetheless, respondent’s expert Dr. Schmidt contends in
his report that ‘‘physician acceptance of the * * * [Benjamin
standards] is limited’’ and that the standards are guidelines
and are only ‘‘accepted as more than guidelines by profes-
sionals who advocate for hormonal and surgical treatment of
Gender Identity Disorder’’. However, Dr. Schmidt conceded
on cross-examination his prior sworn statement to the effect
that he agreed with the Benjamin standards (except that
psychotherapy should be mandatory rather than rec-
ommended) and was unaware of any significant disagreement
with the Benjamin standards in the psychiatric field, other
than those who believe that sex reassignment surgery is
unethical, 47 a position that Dr. Schmidt characterized as a
minority one. Dr. Schmidt also acknowledged that all GID
patients at the sexual disorders clinic at Johns Hopkins
where he practices are advised to become familiar with the
Benjamin standards of care, and he concedes that cross-
gender hormone therapy and sex reassignment surgery ‘‘have
recognized medical and psychiatric benefits’’ for persons suf-
fering from GID. 48 Dr. Schmidt also observed in his report
that most physicians—indeed, most psychiatrists—know very
little about GID or its treatment and shun GID patients, which
may explain why the acceptance of the Benjamin standards
is not broad based in American medicine. In any event, given
his own acceptance of the standards and their use in his
47 Dr. Schmidt cited an article by Dr. Paul McHugh as evidence of the view of sex reassign-
ment surgery as unethical and not medically necessary. On cross-examination, Dr. Schmidt ac-
knowledged that the McHugh article was not published in a peer-reviewed medical journal but
instead in a religious publication. See McHugh, ‘‘Surgical Sex’’, First Things, The Institute on
Religion and Public Life (November 2004), http://www.firstthings.com/index.php (online edition).
Respondent likewise cites the McHugh article on brief as medical opinion, without disclosing the
source of its publication.
48 Dr. Schmidt also acknowledged previously stating that a surgically created vagina in a bio-
logical male with GID ‘‘creates an internal sense of consistency that is very important in main-
taining a balance on a day-to-day basis and not having to bounce back and forth between, you
know, am I male or am I female.’’
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68 134 UNITED STATES TAX COURT REPORTS (34)
clinic, to the extent Dr. Schmidt is suggesting that the stand-
ards have limited acceptance among professionals knowledge-
able regarding GID, he is unpersuasive. The widespread rec-
ognition of the Benjamin standards in the medical literature
in evidence strongly supports the conclusion that the stand-
ards enjoy substantial acceptance.
Moreover, petitioner’s expert Dr. Brown contends that in
the case of severe GID, sex reassignment surgery is the only
known effective treatment; indeed, Dr. Brown was unaware
of any case where psychotherapy alone had been effective in
treating severe GID. The U.S. Court of Appeals for the Sev-
enth Circuit and the highest courts of two States have
reached similar conclusions. See Maggert v. Hanks, 131 F.3d
at 671; Sommers v. Iowa Civil Rights Commn., 337 N.W.2d
470, 473 (Iowa 1983); Doe v. Minn. Dept. of Pub. Welfare, 257
N.W.2d 816, 819 (Minn. 1977). 49
Respondent also argues that petitioner’s sex reassignment
surgery did not ‘‘treat’’ disease within the meaning of section
213(d)(9)(B) because there is insufficient scientific evidence of
the surgery’s efficacy in treating GID. Petitioner’s and
respondent’s experts disagree regarding the sufficiency of the
scientific proof of the surgery’s efficacy. Respondent’s expert
Dr. Schmidt contends that efficacy (beyond patient satisfac-
tion) has not been demonstrated, whereas petitioner’s expert
Dr. Brown believes there is ample proof of positive thera-
peutic outcomes.
Psychiatric reference texts support Dr. Brown’s position.
See Green, ‘‘Gender Identity Disorder in Adults’’, in New
Oxford Textbook of Psychiatry 915 (Gelder, et al., eds.,
Oxford Univ. Press 2000) (stating ‘‘Follow-up reports on oper-
ated transsexuals are generally quite favorable’’ and
describing a study where transsexual patients were randomly
49 Judge Posner wrote in Maggert v. Hanks, 131 F.3d at 671:
The cure for the male transsexual consists not of psychiatric treatment designed to make the
patient content with his biological sexual identity—that doesn’t work—but of estrogen therapy
designed to create the secondary sexual characteristics of a woman followed by the surgical re-
moval of the genitals and the construction of a vagina-substitute out of penile tissue. [Citations
omitted.]
See also Tasman et al., Psychiatry 1491 (2d ed., John Wiley & Sons 2003):
No one knows how to cure [through psychotherapy] an adult’s gender problem. People who have
long lived with profound cross-gender identifications do not get insight—either behaviorally
modified or medicated—and find that they subsequently have a conventional gender identity.
Psychotherapy is useful, nonetheless [citation omitted]. * * *
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(34) O’DONNABHAIN v. COMMISSIONER 69
divided into two groups, one receiving surgery promptly and
the other having surgery postponed for 2 years; ‘‘The group
that received the earlier surgery showed significant improve-
ment in a range of psychometric measures and maintained
employment. The unoperated group showed no improvement
in psychological testing and deteriorated in employment’’);
Green & Blanchard, ‘‘Gender Identity Disorders,’’ in Kaplan
& Sadock’s Comprehensive Textbook of Psychiatry 1660
(Sadock & Sadock, eds., 7th ed., Lippincott Williams & Wil-
kins 2000) (‘‘Outcome studies as a whole suggest that sur-
gical sex reassignment produces additional improvements in
psychosocial adjustment’’); Levine, ‘‘Sexual Disorders’’, in
Psychiatry 1492 (Tasman, et al., eds., 2d ed., John Wiley &
Sons 2005) (‘‘Surgery can be expected to add further improve-
ments in the lives of patients [citation omitted]—more social
activities with friends and family, more activity in sports,
more partner sexual activity, and improved vocational
status’’).
However, even assuming some debate remains in the med-
ical profession regarding acceptance of the Benjamin stand-
ards or the scientific proof of the therapeutic efficacy of sex
reassignment surgery, a complete consensus on the advis-
ability or efficacy of a procedure is not necessary for a deduc-
tion under section 213. See, e.g., Dickie v. Commissioner,
T.C. Memo. 1999–138 (naturopathic cancer treatments
deductible); Crain v. Commissioner, T.C. Memo. 1986–138
(holistic cancer treatments deductible but for failure of
substantiation); Tso v. Commissioner, T.C. Memo. 1980–399
(Navajo ‘‘sings’’ (healing ceremonies) deductible); Rev. Rul.
72–593, 1972–2 C.B. 180 (acupuncture deductible); Rev.
Rul. 55–261, 1955–1 C.B. 307 (services of Christian Science
practitioners deductible). It is sufficient if the circumstances
‘‘justify a reasonable belief the * * * [treatment] would be
efficacious’’. Havey v. Commissioner, 12 T.C. 412. That
standard has been fully satisfied here. The evidence is clear
that a substantial segment of the psychiatric profession has
been persuaded of the advisability and efficacy of hormone
therapy and sex reassignment surgery as treatment for GID,
as have many courts.
Finally, the Court does not doubt that, as respondent’s
expert Dr. Schmidt points out in his report, some medical
professionals shun transsexual patients and consider cross-
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70 134 UNITED STATES TAX COURT REPORTS (34)
gender hormone therapy and sex reassignment surgery
unethical because they disrupt what is considered to be a
‘‘normally functioning hormonal status or destroy healthy,
normal tissue.’’ However, the Internal Revenue Service has
not heretofore sought to deny the deduction for a medical
procedure because it was considered unethical by some. See,
e.g., Rev. Rul. 73–201, 1973–1 C.B. 140 (cost of abortion legal
under State law is deductible medical care under section
213); Rev. Rul. 55–261, supra (services of Christian Science
practitioners deductible). Absent a showing of illegality, any
such ground for denying a medical expense deduction finds
no support in section 213.
In sum, the evidence establishes that cross-gender hor-
mone therapy and sex reassignment surgery are well-recog-
nized and accepted treatments for severe GID. The evidence
demonstrates that hormone therapy and sex reassignment
surgery to alter appearance (and, to some degree, function 50)
are undertaken by GID sufferers in an effort to alleviate the
distress and suffering occasioned by GID, and that the proce-
dures have positive results in this regard in the opinion of
many in the psychiatric profession, including petitioner’s and
respondent’s experts. Thus, a ‘‘reasonable belief ’’ in the
procedures’ efficacy is justified. See Havey v. Commissioner,
supra at 412. Alleviation of suffering falls within the regu-
latory and caselaw definitions of treatment, see Starrett v.
Commissioner, supra; sec. 1.213–1(e)(1), Income Tax Regs.,
and to ‘‘relieve’’ is to ‘‘treat’’ according to standard dictionary
definitions. We therefore conclude and hold that petitioner’s
hormone therapy and sex reassignment surgery ‘‘[treated]
* * * disease’’ within the meaning of section 213(d)(9)(B) and
accordingly are not ‘‘cosmetic surgery’’ as defined in that sec-
tion.
While our holding that cross-gender hormone therapy and
sex reassignment surgery are not cosmetic surgery is based
upon the specific definition of that term in section
213(d)(9)(B), our conclusion that these procedures treat dis-
ease also finds support in the opinions of other courts that
have concluded for various nontax purposes that sex
50 The undisputed evidence is that administration of feminizing hormones to genetic male GID
sufferers produces a psychological calming effect in addition to physical changes. Sex reassign-
ment surgery in genetic males uses penile tissue in the newly created vagina in a manner de-
signed to make the patient capable of arousal and intercourse.
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(34) O’DONNABHAIN v. COMMISSIONER 71
reassignment surgery and/or hormone therapy are not cos-
metic procedures. See, e.g., Meriwether v. Faulkner, 821 F.2d
at 411–413 (rejecting, in an Eighth Amendment case, the
District Court’s conclusion that a transsexual inmate’s
requested hormone therapy was ‘‘ ‘elective medication’ nec-
essary only to maintain ‘a physical appearance and life
style’ ’’ and noting that numerous courts have ‘‘expressly
rejected the notion that transsexual surgery is properly
characterized as cosmetic surgery, concluding instead that
such surgery is medically necessary for the treatment of
transsexualism’’); Pinneke v. Preisser, 623 F.2d 546, 548 (8th
Cir. 1980) (State Medicaid plan may not deny reimbursement
for sex reassignment surgery on grounds that it is ‘‘cosmetic
surgery’’); Rush v. Parham, 440 F. Supp. 383, 390–391 (N.D.
Ga. 1977) (to same effect), revd. on other grounds 625 F.2d
1150 (5th Cir. 1980); J.D. v. Lackner, 145 Cal. Rptr. 570, 572
(Ct. App. 1978) (sex reassignment surgery is not ‘‘cosmetic
surgery’’ as defined in State Medicaid statute; ‘‘We do not
believe, by the wildest stretch of the imagination, that such
surgery can reasonably and logically be characterized as cos-
metic.’’); G.B. v. Lackner, 145 Cal. Rptr. 555, 559 (Ct. App.
1978) (to same effect); Davidson v. Aetna Life & Cas. Ins.
Co., 420 N.Y.S.2d 450, 453 (N.Y. Sup. Ct. 1979) (sex
reassignment surgery is not ‘‘cosmetic surgery’’ within
meaning of medical insurance policy exclusion; sex reassign-
ment surgery ‘‘is performed to correct a psychological defect,
and not to improve muscle tone or physical appearance.
* * * [It] cannot be considered to be of a strictly cosmetic
nature.’’). But see Smith v. Rasmussen, 249 F.3d 755, 759–
761 (8th Cir. 2001) (denial of reimbursement for sex
reassignment surgery proper where State Medicaid plan des-
ignated sex reassignment surgery as ‘‘cosmetic surgery’’ and
alternate GID treatments available).
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72 134 UNITED STATES TAX COURT REPORTS (34)
2. Breast Augmentation Surgery
We consider separately the qualification of petitioner’s
breast augmentation surgery as deductible medical care,
because respondent makes the additional argument that this
surgery was not necessary to the treatment of GID in peti-
tioner’s case because petitioner already had normal breasts
before her surgery. Because petitioner had normal
breasts before her surgery, respondent argues, her breast
augmentation surgery was ‘‘directed at improving * * * [her]
appearance and [did] not meaningfully promote the proper
function of the body or prevent or treat illness or disease’’,
placing the surgery squarely within the section 213(d)(9)(B)
definition of ‘‘cosmetic surgery’’. Petitioner has not argued, or
adduced evidence, that the breast augmentation surgery
ameliorated a deformity within the meaning of section
213(d)(9)(A). Accordingly, if the breast augmentation surgery
meets the definition of ‘‘cosmetic surgery’’ in section
213(d)(9)(B), it is not ‘‘medical care’’ that is deductible pursu-
ant to section 213(a).
For the reasons discussed below, we find that petitioner
has failed to show that her breast augmentation surgery
‘‘[treated]’’ GID. The Benjamin standards provide that breast
augmentation surgery for a male-to-female patient ‘‘may be
performed if the physician prescribing hormones and the sur-
geon have documented that breast enlargement after under-
going hormone treatment for 18 months is not sufficient for
comfort in the social gender role.’’ The record contains no
documentation from the endocrinologist prescribing peti-
tioner’s hormones at the time of her surgery. To the extent
Ms. Ellaborn’s or Dr. Coleman’s recommendation letters to
Dr. Meltzer might be considered substitute documentation
for that of the hormone-prescribing physician, Ms. Ellaborn’s
two letters are silent concerning the condition of petitioner’s
presurgical breasts, while Dr. Coleman’s letter states that
petitioner ‘‘appears to have significant breast development
secondary to hormone therapy’’. The surgeon here, Dr.
Meltzer, recorded in his presurgical notes that petitioner had
‘‘approximately B cup breasts with a very nice shape.’’ 51
Thus, all of the contemporaneous documentation of the condi-
51 Even petitioner conceded in her testimony that she had ‘‘a fair amount of breast develop-
ment * * * from the hormones’’ at the time of her presurgical consultation with Dr. Meltzer.
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(34) O’DONNABHAIN v. COMMISSIONER 73
tion of petitioner’s breasts before the surgery suggests that
they were within a normal range of appearance, and there is
no documentation concerning petitioner’s comfort level with
her breasts ‘‘in the social gender role’’.
Dr. Meltzer testified with respect to his notes that his ref-
erence to the ‘‘very nice shape’’ of petitioner’s breasts was in
comparison to the breasts of other transsexual males on
feminizing hormones and that petitioner’s breasts exhibited
characteristics of gynecomastia, a condition where breast
mass is concentrated closer to the nipple as compared to the
breasts of a genetic female. Nonetheless, given the contem-
poraneous documentation of the breasts’ apparent normalcy
and the failure to adhere to the Benjamin standards’ require-
ment to document breast-engendered anxiety to justify the
surgery, we find that petitioner’s breast augmentation sur-
gery did not fall within the treatment protocols of the Ben-
jamin standards and therefore did not ‘‘treat’’ GID within the
meaning of section 213(d)(9)(B). Instead, the surgery merely
improved her appearance.
The breast augmentation surgery is therefore ‘‘cosmetic
surgery’’ under the section 213(d)(9)(B) definition unless it
‘‘meaningfully [promoted] the proper function of the body’’.
The parties have stipulated that petitioner’s breast aug-
mentation ‘‘did not promote the proper function of her
breasts’’. Although petitioner expressly declined to stipulate
that the breast augmentation ‘‘did not meaningfully promote
the proper functioning of her body within the meaning of
I.R.C. § 213’’, we conclude that the stipulation to which she
did agree precludes a finding on this record, given the failure
to adhere to the Benjamin standards, that the breast aug-
mentation surgery ‘‘meaningfully [promoted] the proper func-
tion of the body’’ within the meaning of section 213(d)(9)(B).
Consequently, the breast augmentation surgery is ‘‘cosmetic
surgery’’ that is excluded from deductible ‘‘medical care’’. 52
52 Respondent also argues that the various surgical procedures petitioner underwent to femi-
nize her facial features in 2000 and 2005 demonstrate a propensity for cosmetic surgery that
is relevant in assessing whether petitioner’s hormone therapy and sex reassignment surgery
were undertaken for the purpose of improving petitioner’s appearance rather than treating a
disease.
We disagree. The deductibility of petitioner’s facial surgery, undertaken in years other than
the year in issue, is not at issue in this case. However, there is substantial evidence that such
surgery may have served the same therapeutic purposes as (genital) sex reassignment surgery
and hormone therapy; namely, effecting a female appearance in a genetic male. Both Ms.
Continued
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74 134 UNITED STATES TAX COURT REPORTS (34)
E. Medical Necessity
Finally, respondent argues that petitioner’s sex reassign-
ment surgery was not ‘‘medically necessary’’, 53 which
respondent contends is a requirement intended by Congress
to apply to procedures directed at improving appearance, as
evidenced by certain references to ‘‘medically necessary’’
procedures in the legislative history of the enactment of the
cosmetic surgery exclusion of section 213(d)(9). 54 Respondent
in effect argues that the legislative history’s contrast of non-
deductible cosmetic surgery with ‘‘medically necessary’’ proce-
dures evidences an intent by Congress to impose a require-
ment in section 213(d)(9) of medical necessity for the deduc-
tion of procedures affecting appearance. We find it unneces-
sary to resolve respondent’s claim that section 213(d)(9)
should be interpreted to require a showing of ‘‘medical neces-
sity’’ notwithstanding the absence of that phrase in the
statute. That is so because respondent’s contention would not
bar the deductions at issue, inasmuch as we are persuaded,
as discussed below, that petitioner has shown that her sex
reassignment surgery was medically necessary.
Respondent’s basis for the claim that petitioner’s sex
reassignment surgery was not medically necessary is the
Ellaborn and Dr. Meltzer testified that petitioner had masculine facial features which interfered
with her passing as female. The expert testimony confirmed that passing as female is important
to the mental health of a male GID sufferer, and the Benjamin standards contemplate surgery
to feminize facial features as part of sex reassignment for a male GID sufferer. Thus, we con-
clude that the facial surgery does not suggest, as respondent contends, that petitioner had a
propensity for conventional cosmetic surgery.
53 Respondent does not make this argument with respect to petitioner’s hormone therapy. His
own expert, Dr. Schmidt, effectively concedes the medical necessity of hormone therapy when
he argues that sex reassignment surgery is not medically necessary because hormone therapy
is one of the ‘‘alternative, successful methods of managing Gender Identity Disorder short of sur-
gery.’’
54 Respondent relies upon the following excerpts from the report of the Senate Finance Com-
mittee issued in connection with the enactment of the cosmetic surgery exclusion of sec.
213(d)(9):
Expenses for purely cosmetic procedures that are not medically necessary are, in essence, vol-
untary personal expenses, which like other personal expenditures (e.g., food and clothing) gen-
erally should not be deductible in computing taxable income.
* * * * * * *
* * * [E]xpenses for procedures that are medically necessary to promote the proper function of
the body and only incidentally affect the patient’s appearance * * * continue to be deductible
* * *. [136 Cong. Rec. 30485, 30570 (1990).]
The Senate Finance Committee report is set out more fully supra note 27. We note that the
discussion of sec. 213(d)(9) in the conference report issued with respect to the agreed final
version of sec. 213(d)(9) contains no reference to ‘‘medical necessity’’ or any variant of the
phrase. See H. Conf. Rept. 101–964, at 1031 (1990), 1991–2 C.B. 560, 562.
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(34) O’DONNABHAIN v. COMMISSIONER 75
expert report and testimony of his expert, Dr. Schmidt. Dr.
Schmidt acknowledges in his report that the definition of
medical necessity ‘‘varies according to the defining party’’.
Dr. Schmidt never expressly defines the term, but he con-
cludes that sex reassignment surgery is not medically nec-
essary because (1) no ‘‘community’’ standard of care requires
it (so that a practitioner’s failure to provide the surgery
would not constitute malpractice) and (2) in his view a thera-
pist should remain neutral regarding the decision to have the
surgery—which makes the surgery, Dr. Schmidt reasons,
elective. 55 Taken together, these two factors indicate that
the surgery is not medically necessary, in Dr. Schmidt’s view.
Respondent has not shown that Dr. Schmidt’s concept of
medical necessity is widely accepted, and it strikes the Court
as idiosyncratic and unduly restrictive. Moreover, Dr.
Schmidt also expressed the view that sex reassignment sur-
gery has ‘‘recognized medical and psychiatric benefits’’ and is
‘‘certainly medically helpful’’.
Dr. Schmidt conceded in his report that a significant seg-
ment of those physicians who are knowledgeable concerning
GID believes that sex reassignment surgery is medically nec-
essary, ranging from those who believe such surgery is gen-
erally medically necessary in treating GID to those who think
it is medically necessary in selected cases. As noted, peti-
tioner’s expert Dr. Brown believes that sex reassignment sur-
gery is often the only effective treatment for severe GID, and
a number of courts have concurred. Dr. Brown therefore
believes the surgery is medically necessary for severe GID.
See also Sadock & Sadock, supra (‘‘When the patient’s gender
dysphoria is severe and intractable, sex reassignment may be
the best solution.’’) Several courts have also concluded in a
variety of contexts that sex reassignment surgery for severe
GID or transsexualism is medically necessary. See Meriwether
v. Faulkner, 821 F.2d at 412; Pinneke v. Preisser, 623 F.2d
at 548; Sommers v. Iowa Civil Rights Commn., 337
N.W.2d at 473; Doe v. Minn. Dept. of Pub. Welfare,
55 Petitioner’s expert Dr. Brown disagrees with the view that a therapist should remain neu-
tral regarding the decision to undergo sex reassignment surgery, believing that a patient experi-
encing the distress of GID is not well equipped to make a decision on irreversible surgery. In
Dr. Brown’s opinion, the therapist should counsel patients towards less invasive treatments
until they have proven ineffective and the surgery appears to be the only effective alternative
left.
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76 134 UNITED STATES TAX COURT REPORTS (34)
257 N.W.2d at 819; Davidson v. Aetna Life & Cas. Ins. Co.,
420 N.Y.S.2d at 453.
The mental health professional who treated petitioner con-
cluded that petitioner’s GID was severe, that sex reassign-
ment surgery was medically necessary, and that petitioner’s
prognosis without it was poor. Given Dr. Brown’s expert
testimony, 56 the judgment of the professional treating peti-
tioner, the agreement of all three experts that untreated GID
can result in self-mutilation and suicide, and, as conceded by
Dr. Schmidt, the views of a significant segment of
knowledgeable professionals that sex reassignment surgery is
medically necessary for severe GID, the Court is persuaded
that petitioner’s sex reassignment surgery was medically nec-
essary.
IV. Conclusion
The evidence amply supports the conclusions that peti-
tioner suffered from severe GID, that GID is a well-recognized
and serious mental disorder, and that hormone therapy and
sex reassignment surgery are considered appropriate and
effective treatments for GID by psychiatrists and other
mental health professionals who are knowledgeable con-
cerning the condition. Given our holdings that GID is a ‘‘dis-
ease’’ and that petitioner’s hormone therapy and sex
reassignment surgery ‘‘[treated]’’ it, petitioner has shown the
‘‘existence * * * of a disease’’ and a payment for goods or
services ‘‘directly or proximately related’’ to its treatment.
See Jacobs v. Commissioner, 62 T.C. 818. She likewise
satisfies the ‘‘but for’’ test of Jacobs, which requires a
showing that the procedures were an essential element of the
treatment and that they would not have otherwise been
undertaken for nonmedical reasons. Petitioner’s hormone
therapy and sex reassignment surgery were essential ele-
ments of a widely accepted treatment protocol for severe GID.
The expert testimony also establishes that given (1) the
risks, pain, and extensive rehabilitation associated with sex
reassignment surgery, (2) the stigma encountered by persons
56 When weighing Dr. Brown’s and Dr. Schmidt’s opposing views on whether sex reassignment
surgery is medically necessary, we consider that Dr. Brown is widely published in peer-reviewed
medical journals and academic texts on the subject of GID, whereas Dr. Schmidt is not. Accord-
ingly, there is a reasonable basis to conclude that Dr. Brown’s views are more widely recognized
and accepted in the psychiatric profession.
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(34) O’DONNABHAIN v. COMMISSIONER 77
who change their gender role and appearance in society, and
(3) the expert-backed but commonsense point that the desire
of a genetic male to have his genitals removed requires an
explanation beyond mere dissatisfaction with appearance
(such as GID or psychosis), petitioner would not have under-
gone hormone therapy and sex reassignment surgery except
in an effort to alleviate the distress and suffering attendant
to GID. Respondent’s contention that petitioner undertook the
surgery and hormone treatments to improve appearance is at
best a superficial characterization of the circumstances that
is thoroughly rebutted by the medical evidence.
Petitioner has shown that her hormone therapy and sex
reassignment surgery treated disease within the meaning of
section 213 and were therefore not cosmetic surgery. Thus
petitioner’s expenditures for these procedures were for ‘‘med-
ical care’’ as defined in section 213(d)(1)(A), for which a
deduction is allowed under section 213(a).
To reflect the foregoing and concessions by the parties,
Decision will be entered under Rule 155.
Reviewed by the Court.
COLVIN, COHEN, THORNTON, MARVEL, WHERRY, PARIS, and
MORRISON, JJ., agree with this majority opinion.
HALPERN J., concurring: I substantially agree with the
majority. I write separately to offer one comment on
the majority’s rationale for disallowing petitioner’s deduction
for her breast augmentation surgery and to offer additional
comments on positions taken in other side opinions.
I. Breast Augmentation Surgery
I am satisfied with the majority’s decision to disallow a
deduction for petitioner’s breast augmentation surgery on the
ground that it did not fall within the treatment protocols of
the Benjamin standards. Majority op. p. 73. For me, that
petitioner failed to prove her doctors adhered to the Ben-
jamin standards requirement that they document her breast-
engendered anxiety is sufficient to find that the surgery did
not fall within those standards. The majority’s added reason,
‘‘the breasts’ apparent normalcy’’, majority op. p. 73, I find
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78 134 UNITED STATES TAX COURT REPORTS (34)
superfluous and potentially misleading. In particular, the
observation of Dr. Meltzer, petitioner’s surgeon, in his pre-
surgical note that petitioner’s breasts were of a very nice
shape was not an aesthetic judgment but rather a clinical
observation relating to the shape of her breasts in compari-
son to the breasts of other transsexual males on feminizing
hormones. Moreover, Dr. Meltzer testified that the surgery
was different from the surgery he would perform on a
biological female: ‘‘[I]t was to give her a female looking
breast, which is quite different from a male breast’’. In
response to a question from the Court, he testified that the
primary purpose of the breast surgery was not to improve
petitioner’s appearance but ‘‘to assign her to the appropriate
gender’’. His medical notes should not be taken out of con-
text.
II. Statutory Interpretation
A. Introduction
We face a task that is not unusual for us, that is, inter-
preting the Internal Revenue Code, and we employ a set of
tools (canons of construction and the like) that are familiar
to both us and the parties. My colleagues raise arguments in
support of respondent that he did not make. 1 Because they
are not addressed by the majority, I use this opportunity to
address some of them.
B. Sex Reassignment Surgery, Treatment, and Mitigation
For the sake of argument, I accept the distinction Judge
Gustafson draws between the words ‘‘treat’’ and ‘‘mitigate’’.
Nevertheless, his argument that sex reassignment surgery
only mitigates (and does not treat) GID rests on a subtle mis-
understanding of that disease.
For Judge Gustafson, petitioner’s disease was the ‘‘delu-
sion’’ that she was a female. Gustafson op. note 9. Judge
Gustafson cannot fathom that someone with a healthy male
body who believes he is female is not sick of mind. Yet the
record suggests that the disease is more than that. A
1 Clearly the issues before us are important to respondent. His opening brief is 209 pages long,
and his answering brief is 72 pages long. Between them, the two briefs show a total of eight
attorneys assisting the Chief Counsel, in whose name the briefs are filed. I assume that re-
spondent made all the arguments that he thought persuasive.
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(34) O’DONNABHAIN v. COMMISSIONER 79
biological male who is convinced he is a woman but does not
exhibit clinically significant distress or impaired functioning
fails to satisfy at least one precondition set forth in DSM–IV–
TR for a diagnosis of GID. 2 Simply put, the ‘‘delusion’’ itself
is not the disease. Instead, for someone suffering from severe
GID (like petitioner) the medical problem—the disease—is the
symptoms. For a significant part of the medical community,
sex reassignment surgery is an accepted approach to elimi-
nating a sufficient number of those symptoms so that a diag-
nosis of GID will no longer hold. And if the diagnosis will no
longer hold, then the patient is cured.
Petitioner’s expert, George R. Brown, M.D., was of the
opinion that sex reassignment surgery does not change the
patient’s belief that his or her psychological gender does not
match his or her biological sex. Nevertheless, he was of the
opinion that, by virtue of petitioner’s hormone therapy and
sex reassignment surgery, she was cured of her GID, ‘‘which
due to the severity and long-standing nature of her condition,
would not have been possible without hormones and sex
reassignment surgery.’’ He testified that, by ‘‘cured’’, he
meant that the symptoms of the disorder were no longer
present for an extended period. She was cured, he testified,
because, when he examined her in March 2007 to prepare his
expert testimony, she no longer met the criteria for a diag-
nosis of GID. For instance, he testified, she had been free for
a long time of clinically significant distress or impairment
resulting from a misalignment of her body and her psycho-
logical sex. Indeed, his explanation comports with a consider-
ation of the diagnostic criteria in DSM–IV–TR (cited by the
majority, majority op. p. 36) for GID. In discussing the diag-
nostic features of GID, DSM–IV–TR states: ‘‘To make the diag-
nosis [of GID], there must be evidence of clinically significant
distress or impairment in social, occupational, or other
important areas of functioning.’’
Dr. Brown seems to have concluded that petitioner was
cured according to the notion discussed above that a disease
is characterized by an identifiable group of signs or symp-
toms, 3 and when those signs or symptoms, once present, are
2 See
discussion of that precondition in the immediately following paragraph.
3 The
principal meaning of ‘‘disease’’ in the American Heritage Dictionary of the English Lan-
guage 517 (4th ed. 2000) is: ‘‘A pathological condition of a part, organ, or system of an organism
Continued
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80 134 UNITED STATES TAX COURT REPORTS (34)
no longer present in sufficient degree or severity to charac-
terize (diagnose) the disease, the patient is free of the dis-
ease; i.e., she is ‘‘cured’’. Whether in fact petitioner was free
of clinically significant distress or impairment (there may
have been some disagreement among the doctors) 4 has no
effect on the force of Dr. Brown’s argument. If petitioner
could be cured, then she could be treated, 5 and, as the
majority makes clear, we do not ground decisions as to med-
ical care on the efficacy of the treatment. Majority op. pp.
69–70. Judge Gustafson has failed to convince me that we
should understand the verb ‘‘to cure’’ in any but the way Dr.
Brown uses it.
C. The Intent of Congress
Judge Goeke rejects surgery as a treatment for GID because
of his contextual reading of the statute: ‘‘I believe that the
word ‘treat’ in the context of the cosmetic surgery exclusion
implies that for expenses for any procedure to be deductible,
the procedure must address a physically related malady.’’
Goeke op. p. 102. Judge Goeke, like Judge Gustafson, how-
ever, fails to provide any convincing support for his position.
Judge Goeke’s contextual argument relies heavily on his
discerning congressional purpose from the report of the
Senate Finance Committee discussed by the majority,
majority op. note 27, and quoted by Judge Goeke, Goeke op.
p. 103. In the light of the report language that he quotes,
Judge Goeke argues: ‘‘The * * * Senate Finance Committee
report indicates that Congress intended to allow deductions
only for cosmetic surgery to correct physical maladies
resulting from disease or physical disfigurement’’. Goeke op.
p. 103. I disagree in general with Judge Goeke’s reliance on
the report given the unambiguous language of section
213(d)(9), and I disagree in particular with the inference he
draws from the report.
resulting from various causes, such as infection, genetic defect, or environmental stress, and
characterized by an identifiable group of signs or symptoms.’’ (Emphasis added.)
4 In rebuttal to Dr. Brown, respondent’s expert, Chester W. Schmidt, Jr., M.D., disagreed with
Dr. Brown’s use of the word ‘‘cure’’ in connection with petitioner, since she continued to suffer
from psychiatric disorders, but he did not dispute that someone who presents no symptoms of
a disease would be considered cured of that disease.
5 Judge Gustafson seems to concede that if GID is curable, then it is treatable: ‘‘[A]ny proce-
dure that does ‘cure’ a disease necessarily ‘treats’ it.’’ Gustafson op. note 7.
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(34) O’DONNABHAIN v. COMMISSIONER 81
In Campbell v. Commissioner, 108 T.C. 54, 62–63 (1997),
we set forth the well-established and well-understood rules
for construing a provision of the Internal Revenue Code:
In construing * * * [a provision of the Internal Revenue Code], our task
is to give effect to the intent of Congress, and we must begin with the
statutory language, which is the most persuasive evidence of the statutory
purpose. United States v. American Trucking Associations, Inc., 310 U.S.
534, 542–543 (1940). Ordinarily, the plain meaning of the statutory lan-
guage is conclusive. United States v. Ron Pair Enters. Inc., 489 U.S. 235,
242 (1989). Where a statute is silent or ambiguous, we may look to legisla-
tive history in an effort to ascertain congressional intent. Burlington N.
R.R. v. Oklahoma Tax Commn., 481 U.S. 454, 461 (1987); Griswold v
United States, 59 F.3d 1571, 1575–1576 (11th Cir. 1995). However, where
a statute appears to be clear on its face, we require unequivocal evidence
of legislative purpose before construing the statute so as to override the
plain meaning of the words used therein. Huntsberry v. Commissioner, 83
T.C. 742, 747–748 (1984); see Pallottini v. Commissioner, 90 T.C. 498, 503
(1988), and cases there cited.
The word ‘‘treat’’ is found in section 213(d)(9) only in the
definition of ‘‘cosmetic surgery’’ in section 213(d)(9)(B). 6 It
forms part of the expression ‘‘does not * * * prevent or treat
illness or disease’’, and nothing in the definition indicates
that the expression excludes surgical treatments for mental
illness or mental disease. The language of section
213(d)(9)(B) is sufficiently plain that, in searching the legis-
lative history of the provision for a contradiction, I would
keep firmly in mind the Supreme Court’s injunction in
United States v. Ron Pair Enters., Inc., 489 U.S. 235, 242
(1989): Ordinarily, the plain meaning of the statutory lan-
guage is conclusive.
I would also keep in mind that, as quoted above, ‘‘where
a statute appears to be clear on its face, we require
unequivocal evidence of legislative purpose before construing
the statute so as to override the plain meaning of the words
6 That provision, on its face, is ambiguous only to the extent that, to give meaning to the term
‘‘other similar procedures’’ in sec. 213(d)(9)(A), the word ‘‘surgical’’ probably should be inferred
before the word ‘‘procedure’’. Sec. 213(d)(9)(B) would then read: ‘‘Cosmetic surgery defined.—For
purposes of this paragraph, the term ‘cosmetic surgery’ means any [surgical] procedure which
is directed at improving the patient’s appearance and does not meaningfully promote the proper
function of the body or prevent or treat illness or disease.’’
Without the inferred ‘‘surgical’’, the set of procedures constituting ‘‘cosmetic surgery’’ would
seem to encompass every procedure (surgical or not) doing nothing other than improving the
patient’s appearance, apparently leaving ‘‘other similar procedures’’ an empty set (empty be-
cause all procedures directed at improving appearance would already be in the set labeled ‘‘cos-
metic surgery’’).
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82 134 UNITED STATES TAX COURT REPORTS (34)
used therein.’’ Campbell v. Commissioner, supra at 63. Here
there is no such evidence. The paragraph of the Senate
Finance Committee report on which Judge Goeke relies does
not adequately illuminate subparagraph (B) of section
213(d)(9) because it discusses ‘‘disease’’ only in the context of
the amelioration of a ‘‘disfiguring disease’’ in subparagraph
(A) of that section. 7 The report does not even mention that,
according to the definition of cosmetic surgery, a procedure
that prevents or treats illness or disease will not be classified
as cosmetic surgery under section 213(d)(9)(B). The Senate
Finance Committee report is far from unequivocal evidence
of legislative purpose contrary to that to be inferred from the
plain language of section 213(d)(9)(B). 8 I would stick with
the plain language and read ‘‘treat’’ and ‘‘illness or disease’’
to have their ordinary meanings.
D. The Plain Language of the Provision
Judge Foley takes both the majority and respondent to
task for not adhering to the plain language of section
213(d)(9). The plain language, he argues, compels the conclu-
sion that for surgery directed at improving appearance to
escape classification as cosmetic surgery under section
213(d)(9)(B) it must both meaningfully promote the proper
function of the body and prevent or treat illness or disease. 9
7 The reference to ‘‘disfiguring disease’’ in subpar. (A) of sec. 213(d)(9) is also clear on its face.
That term is the object of the verb ‘‘to ameliorate’’, which is different from the verb ‘‘to treat’’.
To treat a disease is to seek to cure it; to ameliorate a disfiguring disease is seek to reduce
the effects of a disease now gone. For example, consider dermal abrasion to erase scars left by
a severe case of adolescent acne.
8 Indeed, H. Conf. Rept. 101–964, at 1032 (1990), 1991–2 C.B. 560, 562, which accompanied
the Omnibus Budget Reconciliation Act of 1990, Pub. L. 101–508, sec. 11342(a), 104 Stat. 1388–
471 (adding sec. 213(d)(9)), and which postdates the Senate Finance Committee report, describes
the Senate amendment adding sec. 213(d)(9) in the exact terms of the statute:
The Senate Amendment provides that expenses paid for cosmetic surgery or other similar pro-
cedures are not deductible medical expenses, unless the surgery or procedure is necessary to
ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal
injury resulting from an accident or trauma, or disfiguring disease. For purposes of this provi-
sion, cosmetic surgery is defined as any procedure which is directed at improving the patient’s
appearance and does not meaningfully promote the proper function of the body or prevent or
treat illness or disease.
N.b.: The term ‘‘disease’’ is used twice, in two different contexts, and, as the majority notes, ma-
jority op. note 54, there is no reference to ‘‘medical necessity’’.
9 Judge Foley does not put it that way (i.e., stating what cosmetic surgery is not), but that
must be what he means, because he writes: ‘‘Thus, if petitioner’s procedures are ‘directed at im-
proving * * * appearance’ and ‘[do] not meaningfully promote the proper function of the body’,
they are cosmetic surgery without regard to whether they treat a disease.’’ Foley op. p. 105. I
assume he would concede that a procedure directed at improving appearance that both meaning-
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(34) O’DONNABHAIN v. COMMISSIONER 83
He further argues that, even if not cosmetic surgery within
the meaning of section 213(d)(9)(B), petitioner’s sex reassign-
ment surgery and related procedures (I assume the hormone
therapy) may be ‘‘other similar procedures’’ under section
213(d)(9)(A). I believe that Judge Foley is wrong on his first
count and that, with respect to his second count, neither the
sex reassignment surgery nor the hormone therapy falls
within the class of ‘‘other similar procedures’’.
I agree with Judge Foley that section 213(d)(9)(B) sets
forth a two-part test: A procedure is cosmetic surgery if it (1)
is directed at improving appearance and (2) does not mean-
ingfully promote the proper function of the body or prevent
or treat illness or disease. Because the second part of the test
contains two expressions separated by ‘‘or’’, that part of the
test contains a ‘‘disjunction’’; i.e., a compound proposition
that is true if one of its elements is true. Importantly, how-
ever, the second part of the test contains not just a
disjunction (i.e., (p or q)), but rather the negation of a
disjunction (i.e., not (p or q)). Judge Foley errs because he
assumes that the expression ‘‘not (p or q)’’ is equivalent to
the expression ‘‘(not p) or (not q)’’. Thus, he redefines cos-
metic surgery such that: ‘‘A procedure ‘directed at improving
the patient’s appearance’ is cosmetic surgery if it either does
not ‘meaningfully promote the proper function of the body’ or
does not ‘prevent or treat illness or disease.’ ’’ Foley p. 105.
Judge Foley simply disregards the rules of grammar and
logic in favor of a part of the legislative history that is silent
as to the interpretative question he fashions.
In formal logic, there is a set of rules, De Morgan’s laws,
relating the logical operators ‘‘and’’ and ‘‘or’’ in terms of each
other via negation. E.g., http://en.wikipedia.org/wiki/
DelMorgan’sllaws. The rules are:
not (p or q) = (not p) and (not q)
not (p and q) = (not p) or (not q)
The first of the rules would appear to govern the disjunction
in section 213(d)(9)(B), which is of the form ‘‘not (p or q)’’. Its
equivalent is of the form ‘‘(not p) and (not q)’’, which, sub-
stituting the relevant words, is: ‘‘does not meaningfully pro-
mote the proper function of the body and does not prevent or
fully promotes function and treats a disease is not cosmetic surgery.
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84 134 UNITED STATES TAX COURT REPORTS (34)
treat illness or disease’’. The two-part test of section
213(d)(9)(B) for determining whether a procedure is cosmetic
surgery could then equivalently be rewritten: A procedure is
cosmetic surgery if it (1) is directed at improving appearance
and (2) does not meaningfully promote the proper function of
the body and does not prevent or treat illness or disease. The
second expression is true only if the procedure neither mean-
ingfully promotes the proper function of the body nor pre-
vents or treats illness or disease. If one of the alternatives
is true, however, then the expression is false and the test is
flunked, so that the procedure is not cosmetic surgery. That,
of course, contradicts Judge Foley’s reading of the statute,
but I believe the better view is to presume that Congress is
careful in its drafting and drafts in accordance, rather than
in conflict, with the rules of grammar and logic.
Finally, Judge Foley argues that the ‘‘similar procedures’’
referred to in section 213(d)(9)(A) are delimited only by the
exceptions found in that provision and not the exceptions to
the definition of cosmetic surgery found in section
213(d)(9)(B). 10 That reading seems wrong: Does Judge Foley
suggest that even ‘‘similar procedures’’ that ‘‘meaningfully
promote the proper function of the body’’ and ‘‘prevent or
treat illness or disease’’ are not deductible ‘‘medical care’’?
That cannot be correct. As I noted earlier, if we infer the
word ‘‘surgical’’ before the word ‘‘procedure’’ in the section
213(d)(9)(B) definition of cosmetic surgery, then the term
‘‘other similar procedures’’ in section 213(d)(9)(A) is given
meaning. I would argue that ‘‘other similar procedures’’
refers to nonsurgical, appearance-enhancing procedures, such
as hormone therapy, the deductibility of which is tested by
applying first the exceptions in section 213(d)(9)(B), then
those in section 213(d)(9)(A). Petitioner’s sex reassignment
surgery is excluded from the class of ‘‘other similar proce-
dures’’ principally because it is surgical. Her hormone
therapy is excluded because, as the majority finds, it treats
her disease.
10 I assume that Judge Foley would concede that ‘‘other similar procedures’’, like cosmetic sur-
gery, must be directed at improving appearance. If not, it is difficult to imagine what boundaries
Congress had in mind for other ‘‘similar’’ procedures.
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(34) O’DONNABHAIN v. COMMISSIONER 85
E. Medical Necessity
Without deciding whether section 213(d)(9) requires a
showing of medical necessity, the majority nonetheless finds
that petitioner’s sex reassignment surgery was medically nec-
essary. Majority op. p. 74. Apparently, the majority is pre-
paring for a perhaps different view of the statute by the
Court of Appeals. Judge Holmes’ Brandeis brief 11 exhibits
impressive scholarship, discussing much that is outside the
record. We are a trial court, however, principally restricted
to evidence presented, and arguments made, by the parties.
See Snyder v. Commissioner, 93 T.C. 529, 531–535 (1989).
On the record before us, and as argued by respondent, the
majority’s finding is not clearly erroneous.
HOLMES, J., concurring: On this record, for this taxpayer,
and on the facts found by the Judge who heard this case, I
agree with the majority’s conclusion—that O’Donnabhain can
deduct the cost of her hormone therapy and sex-reassign-
ment surgery, but not her breast-augmentation surgery. I
also agree with the majority that GID is a mental disorder,
and therefore a disease under section 213. But I disagree
with the majority’s extensive analysis concluding that sex
reassignment is the proper treatment—indeed, medically nec-
essary at least in ‘‘severe’’ cases—for GID. It is not essential
to the holding and drafts our Court into culture wars in
which tax lawyers have heretofore claimed noncombatant
status.
11 A Brandeis brief is:
A brief, [usually] an appellate brief, that makes use of social and economic studies in addition
to legal principles and citations. * * * The brief is named after Supreme Court Justice Louis
D. Brandeis, who as an advocate filed the most famous such brief in Muller v. Oregon, 208 U.S.
412 * * * (1908), in which he persuaded the Court to uphold a statute setting a maximum ten-
hour workday for women.
Black’s Law Dictionary 213 (9th ed. 2009); see Snyder v. Commissioner, 93 T.C. 529, 533–534
(1989).
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86 134 UNITED STATES TAX COURT REPORTS (34)
I.
A.
What does it mean for a person born male to testify, as did
O’Donnabhain, that ‘‘I was a female. The only way for me
to—the only way for me to be the real person that I was in
my mind was to have this surgery’’?
This is not like saying ‘‘Lab tests show Vibrio cholerae, and
therefore I have cholera’’, or ‘‘the X-ray shows a tumor in the
lung and therefore I have lung cancer’’, or even ‘‘the patient
reports that he is Napoleon and is being chased by the
English’’, and therefore has schizophrenia.
In the crash course on transsexualism that this case has
forced on us, there are at least four approaches that those
who’ve studied the phenomenon of such feelings have had.
One response, curtly dismissed by the majority, is that this
is a form of delusion:
It is not obvious how this patient’s feeling that he is a woman trapped
in a man’s body differs from the feeling of a patient with anorexia nervosa
that she is obese despite her emaciated, cachectic state. We don’t do
liposuction on anorexics. Why amputate the genitals of these poor men?
Surely, the fault is in the mind and not the member.
McHugh, ‘‘Psychiatric Misadventures’’, Am. Scholar 497, 503
(1992). For such psychiatrists, gender follows sex, is a funda-
mental part of human nature, and is not easily amenable to
change. Those who take this view look at transsexual per-
sons to uncover what they suspect are comorbidities—other
things wrong with their patients that might explain the
undoubtedly powerful feeling that they are wrongly sexed
and whose treatment might alleviate the stress that it causes
them.
A second approach focuses on the notion of ‘‘feeling
female.’’ What does this mean? The answer adopted by the
majority and urged by O’Donnabhain is that this is a short-
hand way of saying that a transsexual person’s gender (i.e.,
characteristic way of feeling or behaving, and conventionally
labeled either masculine or feminine) is strongly perceived by
her as mismatched to her sex (i.e., biological characteris-
tics). 1 This, too, is highly contested territory—gender being
1 For a longer discussion on the definitions of gender versus sex, see Meyer, ‘‘The Theory of
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(34) O’DONNABHAIN v. COMMISSIONER 87
thought by many, particularly feminists, to be entirely some-
thing society imposes on individuals. To such theorists,
transsexualism is likewise a social construct:
The medical profession need not direct the gender dissatisfied to sur-
gery. Counselling is possible to encourage clients to take a more political
approach to their situation and to realize that they can rebel against the
constraints of a prescribed gender role, and relate to their own sex in their
native bodies.
Jeffreys, ‘‘Transgender Activism: A Lesbian Feminist
Perspective,’’ 1 J. Lesbian Stud. 55, 70 (1997) (suggesting SRS
be proscribed as ‘‘crime against humanity’’); see also id. at 56
(citing Raymond, The Transsexual Empire (Teachers College
Press 1994)).
Yet a third school of thought is that the origins of at least
many (but not all) transsexual feelings—particularly those
with extensive histories of secret transvestism—is that it’s
not about gender, but about a particular kind of erotic
attachment. See, e.g., Blanchard, ‘‘Typology of Male-to-
Female Transsexualism,’’ 14 Archives Sexual Behav. 247
(1985); Cohen-Kettenis & Gooren, ‘‘Transsexualism: A
Review of Etiology, Diagnosis and Treatment,’’ 46 J. Psycho-
somatic Res. 315, 321–22 (1999) (summarizing research);
Lawrence, ‘‘Clinical and Theoretical Parallels Between Desire
for Limb Amputation and Gender Identity Disorder,’’ 35
Archives Sexual Behav. 263 (2006). Scholars of this school
regard SRS as justified—not so much to cure a disease, but
because SRS relieves suffering from an intense, innate, fixed,
but otherwise unobtainable desire. See, e.g., Dreger, ‘‘The
Controversy Surrounding The Man Who Would Be Queen: A
Case History of the Politics of Science, Identity, and Sex in
the Internet Age,’’ 37 Archives Sexual Behav. 366, 383–84
(2008).
These are all intensely contested viewpoints. The fourth
and currently predominant view among those professionally
involved in the field is the one urged by O’Donnabhain, and
Gender Identity Disorders,’’ 30 J. Am. Psychoanalytic Assn. 381, 382 (1982) (‘‘Although the term
‘gender’ is sometimes used as a synonym for biological ‘sex,’ the two should be distinguished.
Sex refers to the biology of maleness or femaleness, such as a 46,XY karyotype, testes, or a
penis. Gender or gender identity is a psychological construct which refers to a basic sense of
maleness or femaleness or a conviction that one is male or female. While gender is ordinarily
consonant with biology, and so may appear to be a function of it, gender may be remarkably
free from biological constraint. The sense that ‘I am a female’ in transsexualism, for example,
may contrast starkly with a male habitus.’’)
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88 134 UNITED STATES TAX COURT REPORTS (34)
not effectively contested by the Commissioner: that the rea-
son a transsexual person seeks SRS is to correct a particular
type of birth defect—a mismatch between the person’s body
and her gender identity. That mismatch has a name—GID—
if not yet any clinically verifiable origin, and SRS (plus hor-
mone therapy) is simply the correct treatment of the dis-
order.
I profess no expertise in weighing the merits of biodeter-
minism, feminism, or any of the competing theories on this
question. But the majority’s decision to devote significant
analysis to the importance of characterizing GID as a disease,
and SRS as its medically necessary treatment, pulls me into
such matters to give context to the majority’s analysis.
B.
The majority relies heavily on the Benjamin standards to
establish the proper diagnosis and treatment of GID. I cer-
tainly agree that these standards express the consensus of
WPATH—the organization that wrote them and has seen six
revisions of them over the last 30 years. But the consensus
of WPATH is not necessarily the consensus of the entire med-
ical community. The membership of WPATH is limited, con-
sisting of professionals that work with transsexual patients,
including social workers, psychiatrists, and surgeons that
perform SRS.
The Commissioner’s expert, Dr. Schmidt, testified that the
Benjamin standards are merely guidelines rather than true
standards of care and that they enjoy only limited acceptance
in American medicine generally. The majority cites several
psychiatric textbooks that mention the Benjamin standards
to refute Dr. Schmidt’s claim and as evidence of their general
acceptance in the psychiatric profession. Majority op. note 45.
But the textbooks treat the Benjamin standards as mere
guidelines—which may or may not be followed—rather than
clearly endorsing SRS. Let’s take a closer look at the
excerpted language from each of the majority’s sources:
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(34) O’DONNABHAIN v. COMMISSIONER 89
• ‘‘[The Benjamin standards] [provide] a valuable guide;’’
• ‘‘[T]he patient may be considered for surgical reassign-
ment;’’
• ‘‘The [Benjamin standards of care] programme includes
* * * possibly sex reassignment * * * patients * * * can be
referred for surgery;’’
• ‘‘[S]ex reassignment may be the best solution;’’ and
• After noting that the treatment of gender identity dis-
orders is ‘‘not as well-based on scientific evidence as some psy-
chiatric disorders,’’ the cited text states that ‘‘[l]iving in the
aspired-to gender role * * * enables one of three decisions: to
abandon the quest, to simply live in this new role, or to pro-
ceed with breast or genital surgery.’’
See majority op. note 45 (all emphasis added and citations
omitted). The textbooks do not say that SRS ‘‘should’’ or
‘‘must’’ be used as treatment for GID, but only that it ‘‘may’’
or ‘‘can’’ be used. The members of WPATH certainly follow the
Benjamin standards, but since they are merely a ‘‘guide’’ and
‘‘not as well-based on scientific evidence’’ as other psychiatric
treatments, their general acceptance is questionable. The
American Psychiatric Association’s practice guidelines—gen-
erally accepted standards of care—make no mention of the
Benjamin standards. 2 Even the Benjamin standards them-
selves contain the following caveat in the introduction:
All readers should be aware of the limitations of knowledge in this area
and of the hope that some of the clinical uncertainties will be resolved in
the future through scientific investigation.
The Harry Benjamin International Gender Dysphoria
Association’s Standards of Care for Gender Identity Dis-
orders, Sixth Version 1 (2001).
WPATH is also quite candid that it is an advocate for
transsexual persons, and not just interested in studying or
treating them. Its website includes a downloadable statement
that can be sent to insurers or government agencies denying
reimbursement or payment for surgery to those diagnosed
with GID. WPATH, ‘‘WPATH Clarification on Medical Necessity
of Treatment, Sex Reassignment, and Insurance Coverage in
the U.S.A.,’’ (June 17, 2008), available at http://
www.tgender.net/taw/WPATHMedNecofSRS.pdf (last visited
2 See APA, Practice Guidelines, http://www.psych.org/MainMenu/PsychiatricPractice/
PracticeGuidelinesl1.aspx (last visited Jan. 7, 2010).
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90 134 UNITED STATES TAX COURT REPORTS (34)
Jan. 7, 2010). But it also comprehensively addresses other
problems it feels should be solved. For example,
Genital reconstruction is not required for social gender recognition, and
such surgery should not be a prerequisite for document or record changes
* * *. Changes to documentation are important aids to social functioning,
and are a necessary component of the pre-surgical process * * *.
Id. at 2. Claims of medical necessity as they affect public-
record rules at least suggest the possibility that WPATH is
medicalizing its advocacy.
And even WPATH’s method of identifying candidates for
SRS—the method we describe and effectively endorse today—
is very much contestable. A leading article (admittedly ten
years old at this point, but still oft cited), concluded on this
topic that ‘‘[u]nfortunately, studies evaluating the indispen-
sability of components of the currently employed procedures
are nonexistent.’’ Cohen-Kettenis & Gooren, supra at 325.
II.
The majority reasons that O’Donnabhain’s hormone
therapy and SRS treat a disease, and so their costs are
deductible expenses of medical care. It then adds a coda to
the opinion holding that these treatments are ‘‘medically nec-
essary.’’ Majority op. p. 76.
A.
The best way of framing the question of deductibility is to
view the medical-expense provisions in the Code as creating
a series of rules and exceptions. Section 262(a) creates a gen-
eral rule that personal expenses are not deductible. Section
213(a) and (d)(1) then creates an exception to the general
rule for the expenses of medical care if they exceed a par-
ticular percentage of adjusted gross income. Section 213(d)(9)
then creates an exception to the exception for cosmetic sur-
gery. And section 213(d)(9)(A) then creates a third-order
exception restoring deductibility for certain types of cosmetic
surgery.
To show how this works in practice, consider reconstructive
breast surgery after a mastectomy. This is a personal
expense (i.e., not incurred for profit, in a trade or business,
etc.). But such surgery affects a ‘‘structure of the body’’ under
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(34) O’DONNABHAIN v. COMMISSIONER 91
section 213(d)(1) and so is ‘‘medical care.’’ But it’s presump-
tively ‘‘cosmetic surgery’’ under section 213(d)(9)(B) because,
as reconstructive surgery, it is ‘‘directed at improving the
patient’s appearance and does not meaningfully promote the
proper function of the body or prevent or treat illness or dis-
ease.’’ It is nevertheless deductible cosmetic surgery under
section 213(d)(9)(A) because it is ‘‘necessary to ameliorate a
deformity arising from, or directly related to, a * * * dis-
figuring disease.’’
I agree with the majority’s holding that O’Donnabhain’s
GID is a disease. Until the collapse of psychiatry into the
waiting arms of neurology is complete, courts must of neces-
sity rely on the listing and classification of disorders in the
DSM. 3 But once this point is made, we need not go further
into a discussion of the proper standards of care or opine on
their effectiveness. Our precedent, as the majority correctly
points out, allows for the deductibility of treatments that are
highly unlikely to survive rigorous scientific review. See, e.g.,
Dickie v. Commissioner, T.C. Memo. 1999–138 (naturopathic
cancer treatments); Tso v. Commissioner, T.C. Memo. 1980–
399 (Navajo sings as cancer treatment); see also Rev. Rul.
55–261, 1955–1 C.B. 307, 307 (services of Christian Science
practitioners) (subsequent modifications irrelevant). The key
question under section 213(d)(1) is whether the treatment is
therapeutic to the individual involved. See Fischer v.
Commissioner, 50 T.C. 164, 174 (1968).
This is essentially a test looking to the good-faith, subjec-
tive motivation of the taxpayer. There is no doubt that
O’Donnabhain meets it with regard to her hormone therapy
and SRS.
3 The fluidity of changes in the DSM from edition to edition suggests that the nosology of men-
tal disorders is far from being as precise as, for example, the nosology of diseases caused by
bacteria or vitamin deficiencies. I’m therefore somewhat sympathetic to, if ultimately
unpersuaded by (because of the great weight of precedent), the Commissioner’s effort to change
our interpretation of ‘‘disease’’ in section 213 to mean only maladies with a demonstrated or-
ganic cause.
I must, however, note the Commissioner’s alternative argument that ‘‘negative myths and ig-
norance that permeate social thinking in the United States regarding transgendered persons’’
and the ‘‘many laws and legal situations [that] are highly discriminatory for persons with GID’’
mean that the ‘‘suffering experienced by GID patients is primarily inflicted by an intolerant soci-
ety.’’ Resp. Br. at 172–73. (At least compared to the ‘‘elevated status’’ of the Berdache in some
Native American cultures, the Kathoey in Thailand, the Indian Hijra, and the Fa’afafine in the
South Pacific, as the Commissioner anthropologically concludes. Id. at 175.) It is not effective
advocacy to denigrate the people whose government one is representing.
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92 134 UNITED STATES TAX COURT REPORTS (34)
B.
1. It is the majority’s next step in the analysis—its reading
of the definition of cosmetic surgery in section 213(d)(9)(B)—
that I cannot join. If it had reasoned simply that to ‘‘treat’’
illness in section 213(d)(9)(B) meant the same low standard
that it does in section 213(d)(1)—a subjective good-faith
therapeutic intent on the part of the patient—and stopped,
we wouldn’t be doing anything controversial. In the absence
of any regulation, there would be no reason to demur,
because as the majority carefully points out, the phrase
‘‘medical necessity’’ is nowhere in the Code. Majority op. p.
74. Nor of course is medical necessity consistent with the lib-
eral construction of section 213 both by us and by the IRS.
(The deductibility of Navajo sings and Christian Science
prayer did not depend on their medical necessity.) The
phrase occurs in only one place, in what is not even the most
relevant legislative history. Majority op. note 54.
That should have been enough to dispense with the
Commissioner’s argument on this point. But the majority
tacks on an extra section onto its opinion concluding that SRS
and hormone therapy for transsexual persons are ‘‘medically
necessary.’’ Avoidance would have been the sounder course,
because ‘‘medically necessary’’ is a loaded phrase. Construing
it puts us squarely, and unnecessarily, in the middle of a
serious fight within the relevant scientific community, and
the larger battle among those who are deeply concerned with
the proper response to transsexual persons’ desires for exten-
sive and expensive surgeries.
As the majority thoroughly explains, the theory that SRS is
the best—and perhaps the only—treatment for GID has been
extensively promoted. Dr. Brown, O’Donnabhain’s expert wit-
ness, summed up the theory—SRS is medically necessary to
‘‘cure or mitigate the distress and maladaption caused by
GID.’’ Majority op. p. 43. For governments or insurers to
exclude coverage thus becomes perceived as discrimination or
an unjust deference to stereotypes of transsexual persons.
Acceptance of SRS as medically necessary has become a cause
not only for those with GID, but for a wider coalition as well.
See Jeffreys, supra.
Our discussion of the science is, though, weak even by the
low standards expected of lawyers. Tucked into a footnote is
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(34) O’DONNABHAIN v. COMMISSIONER 93
our opinion on the relative merits of the scientific conclusions
of Dr. Brown (O’Donnabhain’s witness in favor of the medical
necessity of SRS) and Dr. Schmidt (the Commissioner’s wit-
ness who was opposed). Majority op. note 56. The reasoning
in that footnote in favor of Dr. Brown’s opinion is that he is
more widely published than Dr. Schmidt. But Dr. Schmidt
was chair of the Sexual Disorders Work Group that drafted
part of the DSM–IV on which the majority relies, and is a
longtime psychiatry professor at Johns Hopkins and a
founder of its Sexual Behavior Consultation Unit. (I think it
fair to take judicial notice that Johns Hopkins is a well-
regarded medical institution.)
The majority also criticizes Dr. Schmidt for citing a reli-
gious publication. See majority op. note 47. It’s true that one
of the sources Dr. Schmidt cited was an article by the former
chairman of Johns Hopkins’ Psychiatry Department in First
Things. But it is inadequate, if we’re going to weigh in on
this debate, to imply that Johns Hopkins’ conclusion was
based merely on an essay in ‘‘a religious publication.’’
First Things, like Commentary and a host of other general-
interest but serious periodicals, seeks out the small subset of
specialists who can write well. 4 Essays by such people don’t
aspire to be original research, but they are often based on
original research. And so was the First Things article by Dr.
McHugh, which summarized the research of a third member
of the Hopkins Psychiatry Department, Dr. Jon Meyer.
Meyer & Reter, ‘‘Sex Reassignment,’’ 36 Archives Gen.
Psychiatry 1010 (1979). In the study, Dr. Meyer followed up
with former Johns Hopkins Gender Identity Clinic patients.
Unlike authors of previous studies, Meyer included both
unoperated GID patients and post-SRS patients in his study—
allowing him to compare the well-being of the operated and
unoperated patients. Using patient interviews, he issued ini-
tial and followup adjustment scores for both the operated and
unoperated patients. Both the operated and unoperated sub-
jects’ mean scores improved after the followup period, but
there was no significant difference between the improvement
4 It is not quite accurate to label First Things, any more than Commentary, a ‘‘religious publi-
cation’’ given the breadth of the subject matter and lack of sectarian slant in what it publishes.
Dr. Schmidt could’ve just as easily cited the same conclusion by the same author in an essay
in The American Scholar. McHugh, ‘‘Psychiatric Misadventures,’’ Am. Scholar 497 (1992). (The
American Scholar is ‘‘untainted’’ by any connection with religion.)
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94 134 UNITED STATES TAX COURT REPORTS (34)
of each group. The operated group failed to demonstrate clear
objective superiority over the unoperated group—in other
words, SRS didn’t provide any objective improvement to the
GID patients.
There are numerous other clues that the picture of sci-
entific consensus that the majority presents is not quite
right. Consider where the surgeries are currently performed.
SRS was for many years primarily undertaken in research
hospitals that had ‘‘gender identity clinics.’’ 5 These clinics
would conduct research on SRS and evaluate its effectiveness.
Johns Hopkins, under the leadership of Dr. John Money, 6
opened the first U.S. gender identity clinic in 1965. Money
& Schwartz, ‘‘Public Opinion and Social Issues in
Transsexualism: A Case Study in Medical Sociology,’’ in
Transsexualism and Sex Reassignment 253 (Green & Money
eds., 1969). After Johns Hopkins took the lead, other univer-
sity-based clinics jumped at the opportunity to research
transsexualism and perform SRS. 7 But the first research
clinic to perform and study SRS was also the first to cut it
off. The Meyer study had found no significant difference in
adjustment between those who had SRS and those who didn’t,
and in light of that study Johns Hopkins announced in 1979
that it would no longer perform SRS. ‘‘No Surgery for
Transsexuals,’’ Newsweek, Aug. 27, 1979, at 72. After the
Hopkins clinic closed, the other university-based clinics
either closed or ended their university affiliations. Denny,
supra. Stanford, for example, in 1980 spun off its university-
affiliated clinic to a private center that performed SRS but
didn’t conduct research. Levy, ‘‘Two Transsexuals Reflect on
University’s Pioneering Gender Dysphoria Program,’’ Stan-
ford Rep., May 3, 2000.
5 For an overview of the gender clinics, see Denny, ‘‘The University-Affiliated Gender Clinics,
and How They Failed to Meet the Needs of Transsexual People,’’ Transgender Tapestry #098,
Summer 2002, available at http://www.ifge.org/Article59.phtml (last visited Jan. 7, 2010).
6 Dr. Money was extremely influential in gender identity studies. See
Witte, ‘‘John Money; Helped Create Studies on Gender Identity,’’ Associated Press,
July 10, 2006, available at http://www.boston.com/news/globe/obituaries/articles/2006/07/10/
johnlmoneylhelpedlcreatelstudieslonlgenderlidentity/ (last visited Jan. 7, 2010). But
there is now a consensus that some of his most noteworthy work was unethical, and in some
respects fraudulent. See Colapinto, ‘‘The True Story of John/Joan,’’ Rolling Stone, Dec. 11, 1997,
at 54; Kipnis & Diamond, ‘‘Pediatric Ethics and the Surgical Assignment of Sex,’’ 9 J. Clinical
Ethics 398 (Winter 1998).
7 The University of Minnesota, UCLA, Vanderbilt, UVA, Stanford, and Duke were among the
more prominent university-based gender identity clinics conducting research. Denny, supra note
5.
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(34) O’DONNABHAIN v. COMMISSIONER 95
Eventually, all university-based research clinics stopped
the practice of SRS. 8 Id. Today, SRS in the United States is
primarily the purview of a few boutique surgery practices.
While such surgeons—including O’Donnabhain’s—are
undoubtedly skilled in their art, they do not have the
capacity to conduct research on the medical necessity of SRS
like the research hospitals. Their practices use the Benjamin
standards, but do not seem to conduct peer-reviewed studies
of their efficacy.
It is true that the Meyer piece has been the subject of
lively controversy, 9 but it is certainly the case that it
prompted Hopkins to get out of the SRS business; and over
the next few years every other teaching hospital also left the
field. Denny, supra. If we needed to opine on the medical
necessity of SRS, some sensitivity to that academic con-
troversy, particularly the problem of how to set up a proxy
control group for those undergoing sex reassignment, as well
as some sensitivity to defining and measuring the effective-
ness of surgery, would have to be shown. I do not believe we
should have addressed the issue. 10
2. There is, however, a related cluster of problems that
judges and lawyers have had to solve—questions of the med-
ical necessity of SRS in:
• Eighth Amendment prisoner cases;
• ERISA litigation; and
• Medicaid and Medicare reimbursement.
8 Some research hospitals, Stanford among them, will perform SRS on a referral basis—but
the clinical research on SRS at these hospitals has been shut down. Levy, ‘‘Two Transsexuals
Reflect on University’s Pioneering Gender Dysphoria Program,’’ Stanford Rep., May 3, 2000.
9 There has been at least one study that reached a different conclusion using a somewhat simi-
lar methodology. See Mate-Kole et al., ‘‘A Controlled Study of Psychological and Social Change
After Surgical Gender Reassignment in Selected Male Transsexuals,’’ 157 Brit. J. Psychiatr. 261
(1990). There have also been numerous studies without controls (or the sort of quasi-controls
that Meyer used) that report transsexual persons generally satisfied with the results of SRS.
Such studies are as problematic as would be drug studies without double-blind control groups.
The question is further complicated by the possibility that different types of transsexuals, see
Blanchard, ‘‘Typology of Male-to-Female Transsexualism,’’ 14 Archives Sexual Behav. 247
(1985), will experience different outcomes; as might female-to-male transsexuals compared to
male-to-female transsexuals. See generally Cohen-Kettenis & Gooren, supra at 326–28.
My point is not to pick Meyer over Mate-Kole, but only to suggest the problem is much more
complicated than the majority lets on. It is certainly beyond the competence of tax judges.
10 The feelings on both sides may cause the controversy to slip out of science altogether and
land in the politics of the APA as it prepares the next edition of the DSM. See Carey, ‘‘Psychia-
try’s Struggle to Revise the Book of Human Troubles,’’ N.Y. Times, Dec. 18, 2008, at A1 (describ-
ing petition campaigns to affect membership of drafting group, and disputes among
transgendered persons about whether GID should even be classified as a disorder).
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96 134 UNITED STATES TAX COURT REPORTS (34)
The majority correctly cites the decisions of seven circuit
courts that have concluded GID constitutes a ‘‘serious medical
need’’ for purposes of the Eighth Amendment. Majority op. p.
62. While confirming that GID is a ‘‘profound psychiatric dis-
order,’’ see, e.g., Maggert v. Hanks, 131 F.3d 670, 671 (7th
Cir. 1997), no circuit court has in this area held that SRS—
or even the less-invasive hormone therapy—is a ‘‘medically
necessary’’ treatment for GID. At least one has even empha-
sized that there is no right to ‘‘any particular type of treat-
ment, such as estrogen therapy.’’ Meriwether v. Faulkner,
821 F.2d 408, 413 (7th Cir. 1987) (citing Supre v. Ricketts,
792 F.2d 958 (10th Cir. 1986), in which the court refused to
hold that a prison’s decision not to provide a self-injuring
prisoner with estrogen violated the Eighth Amendment as
long as some form of treatment for GID was provided); Lamb
v. Maschner, 633 F. Supp. 351 (D. Kan. 1986) (finding prison
officials were not constitutionally required to provide pris-
oner with specific treatment requested of hormones and SRS).
Judge Posner’s summary of the GID-prisoner cases is instruc-
tive:
Does it follow that prisons have a duty to administer (if the prisoner
requests it) * * * [SRS] to a prisoner who unlike Maggert is diagnosed as
a genuine transsexual? The cases do not answer ‘‘yes,’’ but they make the
question easier than it really is by saying that the choice of treatment is
up to the prison. The implication is that less drastic (and, not incidentally,
less costly) treatments are available for this condition. * * *
Maggert, 131 F.3d at 671 (citations omitted).
The medical necessity of SRS shows up in ERISA litigation
as well. See, e.g., Mario v. P & C Food Mkts., Inc., 313 F.3d
758 (2d Cir. 2002). Mario, a female-to-male transsexual, sued
for reimbursement of the cost of his sex-reassignment sur-
gery from his employer’s ERISA-governed health insurance
plan. The plan administrator denied his claim for lack of
medical necessity based on an investigation that included the
following:
[r]esearch on the issue of transsexualism, inquiry into the policies of other
employers and insurance carriers concerning coverage of gender reassign-
ment procedures, consultation with medical centers having specialized
knowledge of transsexualism and sexual reassignment surgeries, and con-
sultation with medical personnel employed by [the plan administrator],
including a psychiatrist retained by [the plan administrator], Dr. Ivan
Fras. Dr. Fras opined that the surgical removal of healthy organs, for no
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(34) O’DONNABHAIN v. COMMISSIONER 97
purpose other than gender dysphoria, would fall into the category of cos-
metic surgery, and would therefore not be ‘‘medically necessary.’’ On the
basis of her investigation, * * * [the plan administrator employee] con-
cluded that there was substantial disagreement in the medical community
about whether gender dysphoria was a legitimate illness and uncertainty
as to the efficacy of reassignment surgery. * * *
Id. at 765–66. The plan administrator’s SRS-lacks-medical-
necessity conclusion survived de novo review by the Second
Circuit.
Medicare’s administrator—The Centers for Medicare and
Medicaid Services—has weighed in on the issue by denying
reimbursement for SRS on the following basis: 11
Because of the lack of well controlled, long term studies of the safety and
effectiveness of the surgical procedures and attendant therapies for
transsexualism, the treatment is considered experimental. Moreover, there
is a high rate of serious complications of these surgical procedures. For
these reasons, transsexual surgery is not covered.
54 Fed. Reg. 34572 (Aug. 21, 1989).
The legal issues presented in each of these clusters of cases
differ from the legal question—are O’Donnabhain’s proce-
dures deductible under section 213?—that we face in this
case, but I think they illustrate the majority’s overreach in
finding SRS ‘‘medically necessary.’’
III.
I do not think that highlighting what I think is the incor-
rect interpretation of the Code by the majority is enough.
O’Donnobhain carefully argued in the alternative, and it is to
those alternative arguments that I now turn.
A.
I start back at the beginning with section 213(d)(1)(A),
which defines ‘‘medical care’’ to include not just amounts
11 Some cases hold that states cannot categorically exclude sex-change operations from Med-
icaid coverage. Pinneke v. Preisser, 623 F.2d 546, 549–550 (8th Cir. 1980); J.D. v. Lackner, 145
Cal. Rptr. 570 (Ct. App. 1978); G.B. v. Lackner, 145 Cal. Rptr. 555 (Ct. App. 1978); Doe v. Minn.
Dept. of Pub. Welfare, 257 N.W.2d 816 (Minn. 1977). Over time, these decisions have been over-
taken by regulation or statute. See, e.g., Smith v. Rasmussen, 249 F.3d 755, 760–61 (8th Cir.
2001) (upholding regulation overturning Pinneke as reasonable).
Until recently, Minnesota was the only state in which Medicaid paid for SRS. Price, ‘‘Min-
nesota Using Medicaid Funding to Pay for Sex-Change Operations,’’ Wash. Times, Feb. 4, 1996,
at A4. But four years ago, it joined the rest of the states. Minn. Stat. Ann. sec. 256B.0625 subd.
3a (West 2007).
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98 134 UNITED STATES TAX COURT REPORTS (34)
paid for the ‘‘diagnosis, cure, mitigation, treatment, or
prevention or disease,’’ but also amounts paid ‘‘for the pur-
pose of affecting any structure or function of the body.’’ The
Commissioner actually stipulated that all three procedures
O’Donnabhain received that are at issue here—hormone
treatment, SRS, and breast augmentation—meet this alter-
nate definition of ‘‘medical care.’’ 12
This should have obviated the need to wade into the dis-
putes about classification, etiology, and diagnosis of
O’Donnabhain’s GID. The majority does cite one sentence
from the applicable regulation for the proposition that med-
ical care is confined to expenses ‘‘ ‘incurred primarily for the
prevention or alleviation of a physical or mental defect or ill-
ness.’ ’’ Majority op. p. 65 (quoting section 1.213–1(e)(1)(ii),
Income Tax Regs.). But that sentence doesn’t apply to the
second type of medical care—lest it be somehow read to over-
turn even the IRS’s settled opinion that procedures as diverse
as abortion, Rev. Rul. 73–201, 1973–1 C.B. 140, vasectomies,
id., and face lifts, Rev. Rul. 76–332, 1976–2 C.B. 81, qualify
as ‘‘medical care’’ because they affect a structure or function
of the body. (That’s what the first sentence of section 1.213–
1(e)(1)(ii), Income Tax Regs., says. 13)
There is therefore little doubt that the expenses
O’Donnabhain incurred qualify as medical care under section
213(d)(1)(A). But are they nondeductible ‘‘cosmetic surgery?’’
B.
Under section 213(d)(9)(B), it is a necessary condition for
characterization as ‘‘cosmetic surgery’’ that a procedure be
‘‘directed at improving the patient’s appearance.’’
O’Donnabhain urges us to find that her procedures were
directed at resolving or reducing the psychological distress at
feeling herself trapped in a body of the wrong sex. The
Commissioner says that may be true, but the procedures
involved obviously changed her appearance.
12 Here’s what the Commissioner stipulated: ‘‘Petitioner’s sex reassignment surgery affected
structures or functions of petitioner’s body;’’ ‘‘Petitioner’s prescription hormone therapy affected
structures or functions of petitioner’s body;’’ and ‘‘Petitioner’s breast augmentation surgery af-
fected structures or functions of petitioner’s body.’’
13 The sentence quoted by the majority is, in context, aimed at distinguishing expenses aimed
directly, rather then remotely, at preventing or alleviating illness. It is immediately followed by
a list of expenses that are per se medical-care expenses, and which includes surgery and pre-
scription drugs (like hormones) that O’Donnabhain received.
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There is no regulation helping us to apply this language;
we need to use the traditional judicial tools to do so. This
first requires us to parse the meaning of ‘‘directed at’’ and
‘‘improving’’. ‘‘Directed at’’ as a phrase is nowhere else in the
Code and is not a specialized legal or tax term, but it has a
common meaning of ‘‘focused at,’’ or ‘‘concentrating on.’’
‘‘Improving’’ is likewise a word in ordinary use, meaning ‘‘to
enhance,’’ or ‘‘make more desirable.’’ Webster’s Third New
International Dictionary (1961).
The legislative history of the provision, which the majority
quotes, lists some of the procedures that Congress aimed at
including in the presumptively nondeductible category:
under the provision, procedures such as hair removal electrolysis, hair
transplants, lyposuction [sic], and facelift operations generally are not
deductible. In contrast, expenses for procedures that are medically nec-
essary to promote the proper function of the body and only incidentally
affect the patient’s appearance or expenses for the treatment of a dis-
figuring condition arising from a congenital abnormality, personal injury
or trauma, or disease (such as reconstructive surgery following removal of
a malignancy) continue to be deductible * * *.
Majority op. note 27. The list isn’t in the Code itself, so it’s
not quite right to hold we must apply the maxim of ejusdem
generis, but it is helpful in suggesting the meaning of the key
words that did make it into law. Without more specific guid-
ance from the Secretary in the form of a regulation, I would
conclude that ‘‘directed at improving’’ reflects two concepts.
The first is that the subjective motivation of the patient (his
‘‘focus’’) is important, and it is his primary motivation that
is most important. The second is that the notion of
‘‘improving’’ suggests a baseline from which something is
improved—all the procedures in the committee’s list are
those commonly recognized by the average observer in our
society as improving appearance in a way that a biological
man’s taking female hormones and undergoing extensive
genital surgery do not. (I also concur with the majority that
the breast surgery did not ‘‘treat disease.’’)
I therefore end up in the same place as the majority.
O’Donnabhain’s hormone treatment and SRS established a
biological baseline of a new sexual appearance for her. It
was, of course, foreseeable, and she intended, to change her
appearance. But I also agree with her (as the majority does)
that her purpose was to relieve the pathological anxiety or
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100 134 UNITED STATES TAX COURT REPORTS (34)
distress at being biologically male (or, alternatively, at not
feeling masculine). Majority op. note 52. Hormones and SRS
are, I would hold as a general matter in such cases, directed
at treating GID in this sense and do not so much improve
appearance as create a new one.
But the breast-augmentation surgery is different.
O’Donnabhain’s new baseline having been established
through hormones, I would hold that that surgery was
directed at improving—in the sense of focused on changing
what she already had—her already radically altered appear-
ance. Denying the deduction for this procedure while
allowing it for the hormones and SRS also seems a reasonable
distinction—breast surgery is likely one of the commonest
types of cosmetic surgery and (if not undergone after cancer
surgery or trauma or the like) highly likely to be within the
common public meaning of that phrase.
That leaves only the question of whether O’Donnabhain’s
breast-augmentation surgery meets one of the exceptions to
the nondeductibility of cosmetic surgery listed in subsection
(d)(9)(A). This is easy—O’Donnabhain never argued her
breasts were deformed by ‘‘a congenital abnormality, a per-
sonal injury resulting from an accident or trauma, or dis-
figuring disease.’’
I therefore respectfully concur with majority’s result, if not
its reasoning.
GOEKE, J., agrees with this concurring opinion.
GOEKE, J., concurring in the result only: Although I concur
in the result reached by the majority, I respectfully disagree
with the majority’s analysis of section 213.
‘‘Whether and to what extent deductions shall be allowed
depends upon legislative grace; and only as there is clear
provision therefor can any particular deduction be allowed.’’
New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934).
As a general rule, ‘‘personal, living, or family expenses’’ are
not deductible. Sec. 262. As an exception to that general rule
petitioner relies on section 213, which allows a deduction for
‘‘expenses paid * * * for medical care’’. Section 213(d)(1)(A)
defines deductible ‘‘medical care’’ to include ‘‘the diagnosis,
cure, mitigation, treatment, or prevention of disease, or for
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(34) O’DONNABHAIN v. COMMISSIONER 101
the purpose of affecting any structure or function of the
body’’. We have consistently construed the medical expense
deduction ‘‘narrowly’’ for over 40 years. Atkinson v. Commis-
sioner, 44 T.C. 39, 49 (1965); Magdalin v. Commissioner, T.C.
Memo. 2008–293. This case turns on whether petitioner’s
claimed deductions are barred by the exclusion in section
213(d)(9). If medical deductions are construed narrowly, it
follows that statutory exclusions from medical deduction
should be construed broadly.
This case presents the question whether the cost of surgery
to alter nondisfigured, healthy tissue is deductible when the
surgery is performed to address a mental disorder or disease.
Section 213(d)(9) provides:
(9) COSMETIC SURGERY.—
(A) IN GENERAL.—The term ‘‘medical care’’ does not include cosmetic
surgery or other similar procedures, unless the surgery or procedure is
necessary to ameliorate a deformity arising from, or directly related to,
a congenital abnormality, a personal injury resulting from an accident
or trauma, or disfiguring disease.
(B) COSMETIC SURGERY DEFINED.—For purposes of this paragraph, the
term ‘‘cosmetic surgery’’ means any procedure which is directed at
improving the patient’s appearance and does not meaningfully promote
the proper function of the body or prevent or treat illness or disease.
The majority opinion relies on two of the last four words
to the exclusion of the rest of section 213(d)(9)(B) in allowing
a deduction for petitioner’s genital surgery by concluding
that petitioner suffered from a ‘‘disease’’ and that the genital
surgery in question ‘‘[treated]’’ that disease.
The definition of ‘‘cosmetic surgery’’ in subparagraph (B)
begins with surgery ‘‘directed at improving the patient’s
appearance’’. The transformation of petitioner’s genitals was
not directed at improving petitioner’s appearance but rather
was functional. The authorities cited in the majority opinion
for the proposition that genital surgery to treat GID is not
cosmetic surgery support this conclusion. See, e.g., White v.
Farrier, 849 F.2d 322 (8th Cir. 1988). Given the factual
findings supporting the medical purpose of such surgery, it
is therefore deductible as medical care under section 213(a)
and is not excluded by section 213(d)(9) because it is not cos-
metic surgery. On that basis I concur in the majority’s
allowing petitioner a deduction for genital surgery.
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102 134 UNITED STATES TAX COURT REPORTS (34)
Having concluded that petitioner’s genital surgery is not
cosmetic, I would reject the notion that it is nevertheless
excluded as a ‘‘similar [procedure]’’ under section
213(d)(9)(A). Such a reading would negate the import of the
definition of cosmetic surgery in subparagraph (B). Rather, I
believe ‘‘similar procedures’’ in subparagraph (A) refers to
procedures directed at improving appearance that are not
necessarily considered surgical. Accordingly, petitioner’s hor-
mone therapy is not a similar procedure under section
213(d)(9)(A) because it was in support of petitioner’s genital
surgery and was not directed at improving petitioner’s
appearance. On the other hand, Botox injections would be an
example of a similar procedure in my view.
I disagree with the majority opinion because it leaves open
the possibility that expenses for surgery directed solely at
altering physical appearance may nevertheless be deductible
if it is intended to alleviate mental pain and suffering. I do
not read the word ‘‘treat’’ in the context of section
213(d)(9)(B) to include physically altering a patient’s appear-
ance to relieve extreme mental distress. Therefore, I would
hold that the breast surgery is excluded ‘‘cosmetic surgery’’
under section 213(d)(9) as a matter of law, and to this extent
I agree with Judge Gustafson’s concurring in part and dis-
senting in part opinion.
I would read the statute in conformity with the legislative
history. I believe that the word ‘‘treat’’ in the context of the
cosmetic surgery exclusion implies that for expenses for any
procedure to be deductible, the procedure must address a
physically related malady. If surgery to relieve mental suf-
fering without a physical nexus is deductible, a line is
crossed from physical to mental treatment. A court should
not cross that line in applying section 213. Any expansion of
the medical expense deduction should be addressed by Con-
gress because it is not clear that surgery which does not
address a physical condition is deductible under section
213(d)(9).
The majority holds that the line on deductibility for mental
conditions has been crossed in general and that evolving
mental diagnoses are considered diseases for purposes of sec-
tion 213(d)(1)(A). I think this argument overlooks the nature
of the exclusion in paragraph (9). The standard for deduct-
ibility under section 213(d)(1)(A) is inherently more generous
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(34) O’DONNABHAIN v. COMMISSIONER 103
than that in subsection (d)(9). Congress enacted section
213(d)(9) in response to IRS interpretations of ‘‘medical care’’
as including procedures that permanently altered any struc-
ture of the body even if the procedure was considered to be
an elective, purely cosmetic treatment. As the majority points
out, majority op. note 27, the impetus for section 213(d)(9)
was the Senate. The Senate Finance Committee report
stated:
under the provision, procedures such as hair removal electrolysis, hair
transplants, lyposuction [sic], and facelift operations generally are not
deductible. In contrast, expenses for procedures that are medically nec-
essary to promote the proper function of the body and only incidentally
affect the patient’s appearance or expenses for the treatment of a dis-
figuring condition arising from a congenital abnormality, personal injury
or trauma, or disease (such as reconstructive surgery following removal of
a malignancy) continue to be deductible * * *.
There is no indication that the exclusion of surgery directed
at improving appearance omits surgery related to helping a
person feel differently about himself or herself even if such
a change in feelings relieves mental suffering. The above-
quoted language from the Senate Finance Committee report
indicates that Congress intended to allow deductions only for
cosmetic surgery to correct physical maladies resulting from
disease or physical disfigurement, as opposed to cosmetic sur-
gery on healthy tissue. The report uses ‘‘malignancy’’ as an
example of a disease which can cause a deformity requiring
cosmetic surgery which would be deductible.
Accepting that the alteration of physical appearance can be
a remedy to address a mental illness, the question remains
whether deductions for such treatment are barred by a spe-
cific legislative mandate. I would hold that the breast sur-
gery in this case is not medically necessary as that term is
applied in deciding whether an expense is excluded under
section 213(d)(9). The nuances of feminine appearance are
virtually without bounds, and expenses for efforts to conform
petitioner’s entire body to a feminine ideal are indistinguish-
able from excluded expenses regardless of petitioner’s mental
health.
In other contexts there is little question that deductions for
breast augmentation or facial reconstruction surgery apart
from physical disease or disfigurement or physical abnor-
mality would be barred by section 213(d)(9). The issue is
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104 134 UNITED STATES TAX COURT REPORTS (34)
whether Congress intended to allow deductions for those sur-
geries if done to relieve a mental disease or illness. I remain
unconvinced that Congress intended to permit deductions for
such surgery directed at appearance and not directed at
physical disfigurement or physical dysfunction or physical
disease. To accept that deductibility is possible under dif-
ferent facts is to entertain that all forms of cosmetic surgery
will be deductible medical expenses if the surgery addresses
or relieves mental suffering caused by a recognized mental
disorder. I do not agree that the statute read in its entirety
permits such deduction.
HOLMES, J., agrees with this concurring in the result only
opinion.
FOLEY, J., concurring in part 1 and dissenting in part: Pre-
occupied with establishing whether gender identification dis-
order (GID) is a disease, respondent and the majority fail to
correctly explicate and apply the statute. In allowing deduc-
tions relating to petitioner’s expenses, the majority has per-
formed, on congressional intent, interpretive surgery even
more extensive than the surgical procedures at issue—and
respondent has dutifully assisted. This judicial trans-
formation of section 213(d)(9) is more than cosmetic.
I. The Majority Does Not Adhere to the Plain Language of
Section 213(d)(9)
Section 213(d) provides in part:
(9) COSMETIC SURGERY.—
(A) IN GENERAL.—The term ‘‘medical care’’ does not include cosmetic
surgery or other similar procedures, unless the surgery or procedure is
necessary to ameliorate a deformity arising from, or directly related to,
a congenital abnormality, a personal injury resulting from an accident
or trauma, or disfiguring disease.
(B) COSMETIC SURGERY DEFINED.—For purposes of this paragraph, the
term ‘‘cosmetic surgery’’ means any procedure which is directed at
improving the patient’s appearance and does not meaningfully promote
the proper function of the body or prevent or treat illness or disease.
[Emphasis added.]
1 I concur with the majority’s conclusion that petitioner’s breast augmentation surgery is ‘‘cos-
metic surgery’’ but disagree with the majority’s reasoning (i.e., conclusion that failure to strictly
adhere to the Benjamin standards constitutes failure to ‘‘treat’’ gender identification disorder)
and interpretation of the statute.
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(34) O’DONNABHAIN v. COMMISSIONER 105
The majority states that section 213(d)(9)(B) ‘‘excludes from
the definition any procedure’’ (emphasis added) that pro-
motes bodily function or treats a disease. See majority op. p.
52. The statutory definition, however, prescribes what is
included, not excluded, from the definition of cosmetic sur-
gery. The statute sets forth a two-part test: a procedure is
cosmetic surgery if it (1) is directed at improving appearance
and (2) does not meaningfully promote proper bodily function
or 2 prevent or treat illness or disease. Part two of the test
is disjunctive, not conjunctive. A procedure ‘‘directed at
improving the patient’s appearance’’ is cosmetic surgery if it
either does not ‘‘meaningfully promote the proper function of
the body’’ or does not ‘‘prevent or treat illness or disease.’’
Thus, if petitioner’s procedures are ‘‘directed at improving
* * * appearance’’ and ‘‘[do] not meaningfully promote the
proper function of the body’’, they are cosmetic surgery with-
out regard to whether they treat a disease. The majority does
not address either of these prongs but, instead, asserts that
these prongs are irrelevant if the procedures treat a disease.
See majority op. note 30.
The majority’s analysis proceeds as if the statute employs
‘‘and’’ rather than ‘‘or’’ between the ‘‘meaningfully promote
the proper function of the body’’ and ‘‘prevent or treat illness
or disease’’ prongs. Respondent appears to agree with this
interpretation in lieu of a plain reading of the statute. In
essence, the majority and respondent engage in reconstruc-
tion, rather than strict construction, of section 213(d)(9).
According to their interpretation, a procedure will be treated
as cosmetic surgery only if it meets all three prongs (i.e., it
is directed at improving appearance, does not promote proper
bodily function, and does not prevent or treat illness or dis-
ease).
Simply put, the fact that a procedure treats a disease is
not sufficient to exclude the procedure from the definition of
‘‘cosmetic surgery’’. Indeed, to adopt the majority’s reasoning
and its accompanying conclusion the Court must ignore that
Congress in section 213(d)(9)(A) specifically provides that the
term ‘‘medical care’’ will include ‘‘cosmetic surgery or other
2 While ‘‘use of the conjunctive ‘and’ in a list means that all of the listed requirements must
be satisfied * * * use of the disjunctive ‘or’ means that only one of the listed requirements need
be satisfied.’’ Kim, Statutory Interpretation: General Principles and Recent Trends 8 (CRS Re-
port for Congress, updated Aug. 31, 2008).
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106 134 UNITED STATES TAX COURT REPORTS (34)
similar procedures’’ if the ‘‘surgery or procedure is necessary
to ameliorate a deformity arising from, or directly related to,
a * * * disfiguring disease.’’ (Emphasis added.) If any proce-
dure that treats a disease (i.e., as the majority broadly inter-
prets that phrase), see majority op. p. 65, is automatically
carved out from the definition of cosmetic surgery, then the
section 213(d)(9)(A) specific exclusion, relating to procedures
that ameliorate a deformity arising from a disfiguring dis-
ease, is superfluous. See TRW Inc. v. Andrews, 534 U.S. 19,
31 (2001) (stating that it is ‘‘ ‘a cardinal principle of statutory
construction’ that ‘a statute ought, upon the whole, to be so
construed that, if it can be prevented, no clause, sentence, or
word shall be superfluous, void, or insignificant.’ ’’ (quoting
Duncan v. Walker, 533 U.S. 167, 174 (2001))). Congress in
section 213(d)(9)(A) readily acknowledges that certain proce-
dures which treat disease may be cosmetic and ensures that
these procedures will nevertheless be deemed medical care if
they ameliorate a deformity. Sex reassignment surgery (SRS)
and the accompanying procedures did not make the list.
Judge Halpern asserts that this analysis ‘‘disregards the
rules of grammar and logic’’ and that De Morgan’s laws dic-
tate the majority’s holding. Halpern op. p. 83. If there is a
negation of the conjunction ‘‘or’’, De Morgan’s laws convert
‘‘or’’ to ‘‘and’’. Judge Halpern’s mechanical application of De
Morgan’s laws is not prudent. Simply put, congressional
intent is not subservient to De Morgan’s laws. Courts dealing
with statutes that contain the negation of a conjunction have
employed interpretive principles to ensure adherence to Con-
gress’ plain language. 3 In short, section 213(d)(9) must be
3 This tension between Congress’ plain language and De Morgan’s laws was evident in the in-
terpretation of a property forfeiture statute which contained the negation of a conjunction (i.e.,
‘‘without the knowledge or consent’’). See 21 U.S.C. sec. 881(a)(7) (1988); United States v. 171–
02 Liberty Ave., 710 F. Supp. 46 (E.D.N.Y. 1989); cf. United States v. 141st Street Corporation,
911 F.2d 870 (2d Cir. 1990). Rather than applying De Morgan’s laws and interpreting the statu-
tory language to mean ‘‘without the knowledge and without the consent’’, the District Court fol-
lowed legislative intent, adhered to a plain reading, and interpreted the language to mean
‘‘without the knowledge or without the consent’’. United States v. 171–02 Liberty Ave., supra at
50. The court held:
Under normal canons of statutory construction, the court must give effect to Congress’ use
of the word ‘‘or’’ by reading the terms ‘‘knowledge’’ and ‘‘consent’’ disjunctively. * * *
* * * If Congress had meant to require a showing of lack of knowledge in all cases, as sug-
gested by the Government, it could have done so by replacing ‘‘or’’ with ‘‘and.’’ * * * [Id.]
To apply De Morgan’s laws and ignore the plain language of the statute would have been impru-
dent because, as one commentator accurately opined, ‘‘we have no way of telling whether the
drafters of the statute intended that De Morgan’s Rules apply or not’’. Solan, The Language of
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(34) O’DONNABHAIN v. COMMISSIONER 107
interpreted with cognizance of the fact that this section was
enacted by a Congress intent on limiting deductions for
procedures directed at improving appearance and that
Augustus De Morgan was not a member of the 101st Con-
gress.
II. The Legislative History Provides No Support for the
Deduction of Petitioner’s Expenses
The lack of unanimity among my colleagues may suggest
that section 213(d)(9) is ambiguous and thus resort to legisla-
tive history may be appropriate. See Anderson v. Commis-
sioner, 123 T.C. 219, 233 (2004), affd. 137 Fed. Appx. 373
(1st Cir. 2005). The sparse legislative history accompanying
the enactment of section 213(d)(9) is quite illuminating.
There is certainly no indication that Congress sought to pre-
serve a deduction for expenses relating to SRS and the accom-
panying procedures. To the contrary, the legislative history
states that Congress intended to preserve deductions relating
to:
expenses for procedures that are medically necessary to promote the proper
function of the body and only incidentally affect the patient’s appearance or
expenses for treatment of a disfiguring condition arising from a congenital
abnormality, personal injury or trauma, or disease (such as reconstructive
surgery following removal of a malignancy) * * *. [136 Cong. Rec. 30485,
30570 (1990); emphasis added.]
Expenses relating to SRS and the accompanying procedures
again did not make the list.
III. Even If Not Cosmetic Surgery, Petitioner’s Procedures
May Be ‘‘Similar’’ to Cosmetic Surgery
Section 213(d)(9)(A) provides that ‘‘The term ‘medical care’
does not include cosmetic surgery or other similar procedures,
unless the surgery or procedure is necessary to ameliorate a
deformity arising from, or directly related to, a congenital
abnormality, a personal injury resulting from an accident or
trauma, or disfiguring disease.’’ (Emphasis added.) Assuming
arguendo that the majority’s analysis of section 213(d)(9)(B)
is correct, petitioner must nevertheless establish that SRS
and the accompanying procedures are not ‘‘similar’’ to cos-
Judges 45, 52 (1993). See generally id. at 45–46, 49–53 (discussing how courts have dealt with
statutes containing the negation of ‘‘and’’ and ‘‘or’’).
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108 134 UNITED STATES TAX COURT REPORTS (34)
metic surgery. The majority does not expound on this issue
but states:
by arguing that the hormone therapy was directed at improving peti-
tioner’s appearance and did not treat an illness or disease, respondent con-
cedes that a ‘‘similar procedure’’ as used in sec. 213(d)(9)(A) is delimited
by the definition of ‘‘cosmetic surgery’’ in sec. 213(d)(9)(B)—that is, that a
‘‘similar procedure’’ is excluded from the definition of ‘‘medical care’’ if it
‘‘is directed at improving the patient’s appearance and does not meaning-
fully promote the proper function of the body or prevent or treat illness
or disease’’. [Majority op. note 31; emphasis added.]
This analysis of the statute is simply wrong. The term
‘‘similar procedures’’ is not ‘‘delimited by the definition of
‘cosmetic surgery’ in sec[tion] 213(d)(9)(B)’’. While it is
arguable that it could be defined in this manner, that is not
what the statute provides. ‘‘Cosmetic surgery’’ is defined in
section 213(d)(9)(B), but there is no statutory or regulatory
guidance regarding what constitutes ‘‘similar procedures’’.
Respondent, who has the authority to promulgate guidance
defining ‘‘similar procedures’’ and has broad latitude
regarding his litigation position, inexplicably conceded this
issue with respect to the hormone therapy treatment and
apparently failed to make this contention with respect to the
SRS.
Section 213(d)(9)(B) provides a potentially broad disallow-
ance of expenses relating to procedures intended to improve
a taxpayer’s appearance—a disallowance so broad that Con-
gress provided exceptions set forth in section 213(d)(9)(A) to
ensure that certain procedures which address deformities
were deemed medical care. The parties have stipulated that
petitioner’s procedures did not ameliorate a deformity. Even
if SRS and the accompanying procedures fail to meet the defi-
nition of ‘‘cosmetic surgery’’, it is arguable that these proce-
dures are ‘‘similar’’ to cosmetic surgery, not ‘‘medical care’’,
and thus not deductible.
IV. Congressional Activity, Rather Than Respondent’s Litiga-
tion Laxity, Should Determine Deductibility
Apparently respondent, but not Congress, readily concedes
that a procedure (i.e., directed at improving appearance but
not meaningfully promoting proper bodily function) is
excluded from the definition of cosmetic surgery if it treats
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(34) O’DONNABHAIN v. COMMISSIONER 109
a disease. In addition, respondent, but not Congress, appears
to concede that if petitioner’s procedures fail to meet the defi-
nition of cosmetic surgery, these procedures also fail to
qualify as ‘‘similar procedures’’. See majority op. note 31. In
short, respondent fails to adhere to the plain meaning of the
statute. If respondent is comfortable, however, with his cur-
rent interpretation of the statute and the accompanying liti-
gating position, I offer a word of advice—‘‘Katy, bar the
door!’’
WELLS, VASQUEZ, KROUPA, and GUSTAFSON, JJ., agree
with this concurring in part and dissenting in part opinion.
GUSTAFSON, J., concurring in part and dissenting in part:
I concur with the result of the majority opinion to the extent
that it disallows a medical care deduction under section 213
for breast enhancement surgery, but I dissent to the extent
that the majority allows a deduction for genital sex reassign-
ment surgery.
Petitioner is the father of three children from a marriage
that lasted 20 years. Although physically healthy, he was
unhappy with his male anatomy and became profoundly so,
to the point of contemplating self-mutilation. Mental health
professionals diagnosed him as suffering from Gender
Identity Disorder (GID). With their encouragement, he
received medical procedures: In years before the year at issue
here, he received injections of female hormones 1 and under-
went facial surgery and other plastic surgery; and then in
the year at issue he paid a surgeon about $20,000 to remove
his genitals, fashion simulated female genitals, and insert
breast implants. After these procedures, petitioner ‘‘passed’’
as female and became happier. She 2 claimed an income tax
deduction for the cost of this ‘‘sex reassignment surgery’’
(SRS). The question in this case is whether section 213 allows
this deduction.
1 In the year at issue petitioner received $382 of hormone injections. The majority allows that
deduction along with the deduction for genital sex reassignment surgery. I assume that the hor-
mone injections are ‘‘similar’’ to cosmetic surgery and should therefore be disallowed under sec-
tion 213(d)(9)(A), but I do not further address this de minimis deduction.
2 Consistent with petitioner’s preference, I use feminine pronouns to refer to petitioner in her
post-SRS state. However, this convention does not reflect a conclusion that petitioner’s sex has
changed from male to female.
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110 134 UNITED STATES TAX COURT REPORTS (34)
I. Non-issues
The surgical procedures involved in this case are startling,
and to avoid distraction from the actual issues, it is expe-
dient to affirm what is not at issue here: Neither the tax col-
lector nor the Tax Court sits as a board of medical review,
as if it were reconsidering, validating, or overruling the med-
ical profession’s judgments about what medical care is appro-
priate or effective for what medical conditions. Likewise, nei-
ther the tax collector nor the Tax Court passes judgment on
the ethics of legal medical procedures, since otherwise
deductible medical expenses are not rendered non-deductible
on ethical grounds. See, e.g., Rev. Rul. 73–201, 1973–1 C.B.
140 (cost of legal abortion held deductible under section 213).
Rather, we decide only a question of deductibility for
income tax purposes. In section 213 Congress created a
deduction for ‘‘medical care’’, thereby implicitly but nec-
essarily importing into the Internal Revenue Code principles
that rely in part on the judgments of the medical profession.
Medical care that is given pursuant to medical consensus
might later prove to have been unfortunate or even disas-
trous (such as thalidomide prescribed for morning sickness);
but an eventual discovery that the care was ill advised would
not affect the deductibility of that care for income tax pur-
poses. To determine deductibility under section 213, we
determine whether a procedure is ‘‘medical care’’ (as defined
in that statute), not whether we would or would not endorse
it as appropriate care. Neither the IRS nor the Tax Court was
appointed to make such medical endorsements.
Consequently, I accept the majority’s conclusions, based on
expert medical testimony describing medical consensus, 3
that GID is a serious mental condition, that petitioner suf-
fered from it, that the medical consensus favors SRS for a GID
patient like petitioner, that SRS usually relieves the patient’s
suffering to some significant extent, and that SRS was pre-
scribed to and performed on petitioner in accord with pre-
vailing standards of medical care.
3 The majority opinion acknowledges that in the psychiatric community there is a minority
view that SRS is unethical and not medically necessary. Majority op. note 47 (citing testimony
referring to Paul McHugh, ‘‘Surgical Sex’’, First Things (November 2004), http://
www.firstthings.com/index.php (online edition)); majority op. p. 70; see also Holmes op. pts. I.B
and II.B. However, if psychiatry has an intramural dispute about SRS, it will not be arbitrated
by persons trained in tax law.
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(34) O’DONNABHAIN v. COMMISSIONER 111
However, Congress did not cede to doctors the authority to
grant tax deductions. As the majority acknowledges, majority
op. p. 56, medical experts do not decide the interpretation of
the terms in section 213. Rather, statutory interpretation is
the domain of the courts. Although informed by medical
opinion on the medical matters pertinent to medical exper-
tise, the Court alone performs the judicial task of deter-
mining the meaning of a statute and applying it to the facts
of the case before us, on the basis of the record before us. My
disagreement with the majority concerns the interpretation
and application of section 213(d)(9), by which Congress delib-
erately denied deductibility for ‘‘cosmetic surgery or other
similar procedures’’.
II. ‘‘[M]edical care’’, ‘‘cosmetic surgery’’, and ‘‘other similar
procedures’’ in section 213
As a general rule, ‘‘personal, living, or family expenses’’ are
not deductible. Sec. 262. As an exception to that general rule,
Congress enacted in 1942 a deduction for ‘‘expenses paid
* * * for medical care’’, sec. 213(a); but in 1990 Congress
carved out (and declared non-deductible) ‘‘cosmetic surgery or
other similar procedures’’, sec. 213(d)(9). We decide today
whether SRS is deductible ‘‘medical care’’ or instead is non-
deductible ‘‘cosmetic surgery or other similar procedures’’.
‘‘Whether and to what extent deductions shall be allowed
depends upon legislative grace; and only as there is clear
provision therefor can any particular deduction be allowed.’’
New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934)
(emphasis added). This case therefore requires us to deter-
mine whether there is ‘‘clear provision’’ for the deduction of
SRS expenses. I conclude that section 213 is anything but
clear in allowing such a deduction.
A. The language of section 213
The definition of deductible ‘‘medical care’’ in section
213(d)(1)(A) and the definition of non-deductible ‘‘cosmetic
surgery’’ in the exception in subsection (d)(9)(B) must be con-
strued in tandem. The subsection reads in part as follows
(emphasis added):
SEC. 213(d). DEFINITIONS.—For purposes of this section—
(1) The term ‘‘medical care’’ means amounts paid—
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112 134 UNITED STATES TAX COURT REPORTS (34)
(A) for the diagnosis, cure, mitigation, treatment, or prevention of
disease, or for the purpose of affecting any structure or function of the
body * * *.
* * * * * * *
(9) COSMETIC SURGERY.—
(A) IN GENERAL.—The term ‘‘medical care’’ does not include cosmetic
surgery or other similar procedures, unless the surgery or procedure
is necessary to ameliorate a deformity arising from, or directly related
to, a congenital abnormality, a personal injury resulting from an
accident or trauma, or disfiguring disease.
(B) COSMETIC SURGERY DEFINED.—For purposes of this paragraph,
the term ‘‘cosmetic surgery’’ means any procedure which is directed at
improving the patient’s appearance[4] and does not meaningfully pro-
mote the proper function of the body or prevent or treat illness or dis-
ease.
Thus, in 1942 ‘‘medical care’’ was defined in subsection
(d)(1)(A) with two alternative prongs—first, a list of five
modes of care for disease, i.e., ‘‘diagnosis, cure, mitigation,
treatment, or prevention’’; 5 and second, care that ‘‘affect[s]
any structure or function of the body’’.
4 Petitioner contends that SRS is not ‘‘directed at improving the patient’s appearance’’ for pur-
poses of section 213(d)(9)(B); respondent contends that it is; and the majority concludes, majority
op. note 30, that it ‘‘need not resolve’’ the issue. On this basis, however, Judge Goeke’s concur-
rence would allow a deduction for the genital SRS because it ‘‘was not directed at improving
petitioner’s appearance but rather was functional.’’ Goeke op. p. 101. His concurrence thus right-
ly discerns that section 213(d)(9)(B) distinguishes ‘‘improving * * * appearance’’ from
‘‘promot[ing] * * * proper function’’ (emphasis added); but there is no basis for the conclusion
that SRS is ‘‘functional’’. Petitioner’s SRS did not involve any attempt to confer female reproduc-
tive function. No one undertaking to ‘‘promote’’ sexual ‘‘function’’ would perform a penectomy
and a castration on a healthy male body. On the contrary, SRS drastically terminates a male
patient’s functioning sexuality. SRS did not change petitioner into a ‘‘function[ing]’’ female, but
removed his salient male characteristics and attempted to make him resemble a woman—i.e.,
by petitioner’s lights, to ‘‘improve[ ] the patient’s appearance’’. The majority shows that the SRS
surgeon does try to salvage, as much as possible, some possibility for subsequent sexual re-
sponse, majority op. p. 41, and observes that SRS ‘‘alter[s] appearance (and, to some degree,
function)’’, majority op. p. 70 (emphasis added); but the majority makes no finding that peti-
tioner proved that any identifiable portion of the SRS expense can be allocated to restoration
of ‘‘function’’. On our record, petitioner’s SRS must be said to have been directed at improving
appearance rather than promoting function, and it is therefore within the definition of ‘‘cosmetic
surgery’’. Judge Holmes’s concurrence, on the other hand, attempts no analysis of function
versus appearance, but rather proposes a different distinction not explicit in the statute: He
would hold that SRS did not ‘‘so much improve [petitioner’s male] appearance as create a new
[female] one.’’ Holmes op. p. 99 (emphasis added). This ingenious distinction, if accepted, might
well undo the disallowance of deductions for cosmetic surgery, since plastic surgery is often mar-
keted and purchased on the grounds that it supposedly creates a ‘‘new appearance’’. But in fact,
any surgery that gives the patient a ‘‘new appearance’’ has thereby ‘‘improved’’ the patient’s
former appearance and is ‘‘cosmetic surgery’’ under section 213(d)(9)(B).
5 The five terms employed to define ‘‘medical care’’ for income tax purposes in 1942 were bor-
rowed from the definitions of ‘‘drug’’ and ‘‘device’’ added in 1938 to the Federal Trade Commis-
sion Act by the Federal Trade Commission Act amendments of 1938, ch. 49, sec. 4, 52 Stat. 114,
currently codified at 15 U.S.C. sec. 55(c), (d)(2) (2006). The same five terms currently appear
in virtually identical definitions of ‘‘medical care’’ in 29 U.S.C. sec. 1191b(a)(2)(A) (2006) (for
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(34) O’DONNABHAIN v. COMMISSIONER 113
In 1990 the concepts of both these prongs were narrowed
in subsection (d)(9)(B) for the purpose of creating a limited
exception to the new disallowance of ‘‘cosmetic surgery or
other similar procedures’’. That is, appearance-improving
procedures were declared to be non-deductible ‘‘cosmetic sur-
gery’’, but the definition given for that term provides a two-
prong exception: These appearance-improving procedures are
nonetheless deductible under (d)(9)(B) (i.e., are not ‘‘cosmetic
surgery’’) if they ‘‘meaningfully promote the proper function
of the body’’ (i.e., not if they ‘‘affect[ ] any structure or func-
tion of the body’’, as more broadly allowed in (d)(1)(A)) and
are nonetheless deductible under (d)(9)(B) if they ‘‘prevent or
treat’’ disease (i.e., not if they provide ‘‘diagnosis, cure, miti-
gation, treatment, or prevention of disease’’, as more broadly
allowed in (d)(1)(A)).
Two features of this statutory language that are virtually
overlooked in the majority opinion should be noted: First,
section 213(d)(9)(A) disallows deductions for ‘‘cosmetic sur-
gery or other similar procedures’’. (Emphasis added.) That is,
expenses for a procedure that falls outside ‘‘cosmetic surgery’’
(as defined in subsection (d)(9)(B)) may still be disallowed if
the procedure is ‘‘similar’’ to ‘‘cosmetic surgery’’. Congress
thus enacted this disallowance in such a way that splitting
hairs in order to find a procedure not to be within the spe-
cific definition of ‘‘cosmetic surgery’’ in (d)(9)(B) may not and
should not save the day for its deductibility. Rather, deduct-
ibility must be denied under (d)(9)(A) if the non-‘‘cosmetic
surgery’’ procedure is nonetheless ‘‘similar’’ to cosmetic sur-
gery.
Second, assuming that subsection (d)(9)(B) permits deduct-
ibility if not both but only one of its prongs is satisfied (i.e.,
if a procedure only ‘‘prevent[s] or treat[s]’’), 6 it must be noted
purposes of group health plans under ERISA) and 42 U.S.C. sec. 300gg–91(a)(2) (2006) (for pur-
poses of requirements relating to health insurance coverage). They also appear in definitions of
‘‘drug’’ and ‘‘device’’ in 21 U.S.C. sec. 321(g)(1)(B) and (h)(2) (2006) and in the definitions of
‘‘radiologic procedure’’ and ‘‘radiologic equipment’’ in 42 U.S.C. sec. 10003(2) and (3) (2006). They
appear in their verb forms in 42 U.S.C. sec. 247d–6d(i)(7)(A) (2006) (defining ‘‘qualified pan-
demic or epidemic product’’) and 21 U.S.C. sec. 343(r)(6) (2006) (restricting statements about die-
tary supplements). They appear as adjectives and gerunds, along with ‘‘therapeutic’’ and ‘‘reha-
bilitative’’, in 26 U.S.C. sec. 7702B(c)(1) (defining ‘‘qualified long-term care services’’). Thus, this
fivefold list is not unique to the Internal Revenue Code.
6 The majority (like the parties) interprets subsection (d)(9)(B) to permit deductibility if a pro-
cedure does not ‘‘meaningfully promote’’ but does ‘‘prevent or treat’’; and the majority evaluates
the expenses only under that second prong, to determine whether the procedures at issue here
Continued
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114 134 UNITED STATES TAX COURT REPORTS (34)
that this second prong in subsection (d)(9)(B) has only two
terms—‘‘prevent’’ and ‘‘treat’’—from among the list of five
possible modes of ‘‘medical care’’ in subsection (d)(1)(A). I
now turn to the significance of that wording.
B. The different terminology of subsections (d)(1)(A) and
(d)(9)(B)
As is noted above, ‘‘medical care’’ is defined in subsection
(d)(1)(A) by five terms—i.e., ‘‘diagnosis, cure, mitigation,
treatment, or prevention’’. Some of these terms do have some
overlapping shades of meaning, and it seems likely that
when this ‘‘medical care’’ deduction was first enacted in 1942,
Congress simply intended to enact a broad definition of med-
ical care and therefore chose terms to convey that breadth,
without particular intention about the potential distinctive
meanings of those terms. The distinctive meanings would
have been irrelevant under the general provision that
allowed the deduction if any of these modes of care was pro-
vided. That is, if a medical procedure was a ‘‘treatment’’ but
not a ‘‘mitigation’’, or was a ‘‘mitigation’’ but not a ‘‘treat-
ment’’, the expense would be deductible nonetheless under
section 213(d)(1)(A).
However, we consider here the very different and specific
congressional intent 48 years later in 1990, when Congress
enacted subsection (d)(9) to disallow deductions for cosmetic
surgery. Congress provided an exception to this new dis-
allowance, and allowed a deduction in the case of an other-
wise cosmetic procedure, if it ‘‘prevent[s] or treat[s] illness or
disease’’. Sec. 213(d)(9)(B) (emphasis added). According to
this subsection, an otherwise cosmetic procedure will yield a
deduction if it ‘‘prevent[s] or treat[s]’’ disease—i.e., two
modes of care. Missing from this short list of deductible
modes of care in subsection (d)(9)(B), as we have already
noted, are three of the five terms in subsection (d)(1)(A),
including ‘‘mitigation’’. The 1990 Congress was thus under-
do ‘‘treat’’ disease. But see the opinion of Judge Foley, interpreting the definition in subsection
(d)(9)(B) to disallow deductions for appearance-improving procedures unless a procedure both
‘‘meaningfully promote[s] the proper function of the body’’ and ‘‘prevent[s] or treat[s]’’ disease.
The majority does not undertake to demonstrate that SRS ‘‘meaningfully promote[s] the proper
function of the body’’, and if the statute requires that both prongs be satisfied, then SRS must
therefore be non-deductible. In this partial dissent, however, I assume arguendo that only one
prong need be satisfied; and I show that even so, contrary to the majority’s conclusion, SRS does
not ‘‘prevent or treat’’ GID and therefore cannot be deductible even under the majority’s one-
prong analysis.
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(34) O’DONNABHAIN v. COMMISSIONER 115
taking to provide a limited exception to its new disallowance,
and in so doing it was selective in choosing from the vocabu-
lary at hand. Under the wording Congress adopted, if an
otherwise cosmetic procedure ‘‘mitigates’’ a disease but
cannot be said to ‘‘treat’’ or ‘‘prevent’’ it, then under the plain
terms of the statute, one would have to conclude that the
expense of that procedure is non-deductible.
Congress provided that, to be deductible, an otherwise cos-
metic procedure must ‘‘prevent or treat’’ a disease. Petitioner
did not argue (and the majority does not hold) that SRS ‘‘pre-
vents’’ GID (rather, SRS is offered only to persons who already
suffer from the disorder, for whom ‘‘prevention’’ would come
too late); so the contention must be that SRS ‘‘treats’’ GID.
III. The meaning of ‘‘treat’’ in section 213(d)(9)(B)
The majority implicitly holds that ‘‘prevent or treat’’ in sec-
tion 213(d)(9)(A) is equivalent to, or is shorthand for,
‘‘diagnos[e], cure, mitigat[e], treat[ ], or prevent[ ]’’ in sub-
section (d)(1)(A) and that no narrow meaning should be
ascribed to ‘‘treat’’. Admittedly, it is possible to use the word
‘‘treat’’ in a loose manner that could include merely amelio-
rating the effects of a disease. In that loose sense, one could
say that SRS ‘‘treats’’ GID by mitigating the unhappiness of
the sufferer. ‘‘Treatment’’ and ‘‘mitigation’’ do appear side by
side as modes of ‘‘care’’ in (d)(1)(A), reflecting different
shades of meaning of the more general word ‘‘care’’; and thus
to some extent they are synonymous. If they were such close
synonyms as to be equivalent in meaning (or if ‘‘treat’’
included ‘‘mitigate’’ 7), then the absence of ‘‘mitigate’’ in
(d)(9)(B) would not be significant. However, ascribing this
broad or loose meaning to ‘‘treat * * * disease’’ is untenable
under section 213, where ‘‘treat’’ must be distinguished from
‘‘mitigate’’, and where the direct object is ‘‘disease’’ (not
‘‘patient’’ or ‘‘symptom’’), as I now show.
7 By way of comparison, the absence of ‘‘cure’’ from section 213(d)(9)(B) is apparently not sig-
nificant, because of the relationship of ‘‘treat’’ and ‘‘cure’’. ‘‘Treat’’ is a broader word that includes
‘‘cure’’. That is, although not everything that ‘‘treats’’ a disease undertakes to ‘‘cure’’ it, any pro-
cedure that does ‘‘cure’’ a disease necessarily ‘‘treats’’ it.
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116 134 UNITED STATES TAX COURT REPORTS (34)
A. To yield a deduction, an appearance-improving proce-
dure must ‘‘treat’’ disease (as opposed to effecting
‘‘mitigation’’).
Subsection (d)(9)(B) does not provide that appearance-
improving procedures are deductible if they ‘‘prevent, treat,
or mitigate’’ a disease, but rather if they ‘‘prevent or treat’’
disease. The majority’s leading definition of ‘‘treat’’, majority
op. p. 65, taken from Webster’s New Universal Unabridged
Dictionary (2003), is ‘‘to deal with (a disease, patient, etc.) in
order to relieve or cure’’; and the same dictionary’s definition
of ‘‘mitigate’’ is—
1. to lessen in force or intensity, as wrath, grief, harshness, or pain; mod-
erate. 2. to make less severe * * *. 3. to make (a person, one’s state of
mind, disposition, etc.) milder or more gentle; mollify; appease.
A usage note observes that the ‘‘central meaning [of ‘‘miti-
gate’’] is ‘to lessen’ or ‘make less severe’ ’’. Thus, the two
words ‘‘treat’’ and ‘‘mitigate’’ are by no means identical.
Consequently, a question directed toward ‘‘treatment’’ of a
disease may ask (using language from Webster’s): Did the
procedure ‘‘deal with’’ the disease? Or it may ask (using lan-
guage from Havey v. Commissioner, 12 T.C. 409, 412 (1949)
(emphasis added)): ‘‘[D]id the treatment bear directly on the
* * * condition in question’’? But a question about ‘‘mitiga-
tion’’ may ask (using language from Webster’s): Did the
procedure ‘‘make [the disease] less severe’’ or ‘‘lessen * * *
pain’’? And a comment that is framed in terms of ‘‘mitiga-
tion’’ may speak of ‘‘mitigation of the effects of his injury and
disability’’. Pols v. Commissioner, T.C. Memo. 1965–222, 24
T.C.M. 1140 (1965) (emphasis added). Our Opinion in
Starrett v. Commissioner, 41 T.C. 877, 881 (1964), includes
such usage of both these terms. In Starrett we held that psy-
chiatric expenses were ‘‘clearly ‘amounts paid for the diag-
nosis, cure, mitigation, treatment,’ and ‘prevention’ of a spe-
cific ‘disease’ ’’; and we upheld the taxpayer’s argument that
he underwent psychoanalysis—
for the diagnosis of his emotional condition, cure of a specific emotional
disease classified as anxiety reaction, mitigation of the effects upon him of
such disease, treatment of the underlying causes of his anxiety reaction,
and thereby the prevention of further suffering therefrom * * *. [Id.;
emphasis added.]
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(34) O’DONNABHAIN v. COMMISSIONER 117
When ‘‘treat’’ and ‘‘mitigate’’ are distinguished, rather than
being blended, ‘‘treatment’’ addresses underlying causes and
‘‘mitigation’’ lessens effects. I conclude that this distinction
between ‘‘treat’’ and ‘‘mitigate’’ is critical to determining
whether SRS ‘‘treats’’ GID, so as to render SRS expenses
deductible.
B. To yield a deduction, an appearance-improving proce-
dure must treat ‘‘disease’’ (as opposed to treating a
patient or a symptom).
If the parties and the majority have in effect defined
‘‘treat’’ so broadly as to nearly encompass ‘‘mitigate’’, they
may have done so by overlooking the fact that, in section
213(d)(9)(B), the object of the verb ‘‘treat’’ is ‘‘disease’’. The
breadth of the dictionary definitions cited by the majority,
majority op. p. 65, is attributable in part to the fact that one
may ‘‘treat’’ a disease, or a patient, or a symptom. Con-
sequently, a general definition of ‘‘treat’’ that is not con-
fined—as section 213 is confined—to treatment of a disease
should and will reflect shades of meaning appropriate for
treatment of symptoms, which shades of meaning overlap
more with ‘‘mitigate’’. For that reason these general dic-
tionary definitions are not very illuminating in this instance,
where the question is whether to ‘‘treat’’ disease is or is not
the same as to ‘‘mitigate’’ disease.
As a part of ‘‘medical care’’, one could ‘‘treat’’ a patient with
palliative care or could ‘‘treat’’ his painful symptoms with
morphine (both of which could also be said to ‘‘mitigate’’, and
the expenses of which would be deductible under section
213(a))—all the while leaving his disease un-‘‘treated’’,
strictly speaking. When Congress intends to enact a provi-
sion that turns on ‘‘treatment of patients’’ 8 or on ‘‘treatment
of symptoms’’, 9 it knows how to do so; but it did not do so
8 See sec. 168(i)(2)(C) (emphasis added); see also sec. 5214(a)(3)(D); 10 U.S.C. sec. 1077 (2006);
21 U.S.C. sec. 802 (2006); 22 U.S.C. sec. 2151b–3 (2006); 24 U.S.C. sec. 225g (2006); 38 U.S.C.
secs. 1706, 1718, 7332 (2006); 42 U.S.C. secs. 238b, 256e, 280e, 280g–6, 280h–3, 290dd–2, 291o,
300d–41, 1320b–8 (2006).
9 See 8 U.S.C. sec. 1611(b)(1)(C) (2006) (emphasis added); see also 8 U.S.C. secs. 1613, 1621,
1632 (2006); 42 U.S.C. secs. 285o–4(d), 300cc–3, 1395i–3, 1396r (2006). Focusing on treatment
of symptoms, Judge Halpern emphasizes, Halpern op. p. 79 (emphasis added), that petitioner’s
expert pronounced petitioner ‘‘cured’’ (even though petitioner’s belief about her sex was un-
changed) in the sense that ‘‘the symptoms of the disorder were no longer present’’, e.g., ‘‘she had
been free for a long time of clinically significant distress or impairment’’; and Judge Halpern
Continued
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118 134 UNITED STATES TAX COURT REPORTS (34)
in section 213(d)(9)(B), which allows deductions for proce-
dures that ‘‘treat * * * disease’’. (Emphasis added.) If a
procedure is said to ‘‘treat * * * disease’’, then ‘‘the treat-
ment [will] bear directly on the * * * condition in question’’,
Havey v. Commissioner, supra at 412, or will ‘‘deal with’’ the
disease (as in Webster’s). Other medical care may be ‘‘mitiga-
tion’’, but not ‘‘treatment’’.
In defining ‘‘cosmetic surgery’’, Congress aimed to deny
deductions that had previously been allowed. If in the
amended statute Congress had allowed deductions for
appearance-improving procedures that ‘‘prevent, treat, or
mitigate’’ a disease, then that broader exception might have
undermined the intended limiting effect of the new disallow-
ance. The majority’s loose interpretation of subsection
(d)(9)(B) treats the statute as if Congress had enacted that
imaginary broader exception, and its loose interpretation
invites arguments for the deduction not only of GID patients’
SRS expenses but also of the cosmetic surgery expenses of any
psychiatric patient who is (or claims to be) pathologically
unhappy with his body. 10 In any event, Congress did not pro-
vide that an appearance-improving procedure will nonethe-
less be deductible if it merely ‘‘mitigates’’ a disease.
equates a removal of symptoms with a ‘‘cure’’ of the disease (and therefore a ‘‘treatment’’ of the
disease), Halpern op. pp. 79–80. However, when treatment of symptoms makes a psychiatric pa-
tient content with his delusion, he has not been cured, and his ‘‘disease’’ has not been ‘‘treat[ed]’’
for purposes of section 213(d)(9)(B).
10 See Diagnostic and Statistical Manual of Mental Disorders 576–582 (Body Dysmorphic Dis-
order (BDD)) (4th ed., text revision 2000) (DSM–IV–TR): ‘‘The essential feature of Body
Dysmorphic Disorder (historically known as dysmorphophobia) is a preoccupation with a defect
in appearance * * *. The defect is either imagined, or, if a slight physical anomaly is present,
the individual’s concern is markedly excessive * * *. The preoccupation must cause significant
distress or impairment in social, occupational, or other important areas of functioning’’. The
entry for BDD in DSM–IV–TR is not in the record; but the majority refers to ‘‘DSM–IV–TR,
which all three experts agree is the primary diagnostic tool of American psychiatry’’, majority
op. p. 60, and states that the U.S. Supreme Court has relied on a listing in the DSM in treating
something as a ‘‘serious medical condition’’, majority op. note 40; and I take judicial notice of
the BDD entry. See, e.g., United States v. Long, 562 F.3d 325, 334–335 & n.22 (5th Cir. 2009);
United States v. Johnson, 979 F.2d 396, 401 (6th Cir. 1992). Whether BDD is a ‘‘disease’’ and
whether cosmetic surgery purportedly prescribed for it could be ‘‘treat[ment]’’ under section
213(d)(9)(B) are questions yet to be litigated—if the majority’s broad interpretation of section
213(d)(9)(B) prevails.
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(34) O’DONNABHAIN v. COMMISSIONER 119
C. A looser interpretation of ‘‘treat * * * disease’’ is not
warranted in section 213(d)(9)(B).
1. The structure of subsection (d)(9)(B) shows deliberate
restriction in its terminology.
Congress enacted section 213(d)(9) to restrict medical care
deductions by explicitly denying such deductions for cosmetic
surgery and similar procedures. Its terms must be under-
stood by reference to that announced purpose. Consistent
with that purpose, subsection (d)(9)(B) reflects, as I have
shown, a narrowing of both prongs of the subsection (d)(1)(A)
definition of ‘‘medical care’’—i.e., subsection (d)(1)(A)’s
‘‘affect[ ] any structure or function of the body’’ was narrowed
to become ‘‘meaningfully promote the proper function of the
body’’ in (d)(9)(B); and subsection (d)(1)(A)’s ‘‘diagnosis, cure,
mitigation, treatment, or prevention of disease’’ was nar-
rowed to become ‘‘prevent or treat’’ disease in (d)(9)(B).
Where Congress was explicitly setting out to shut down
deductions for cosmetic surgery, the restricting language it
employed can hardly be taken as careless or unintentional.
2. The stricter interpretation of subsection (d)(9)(B) is con-
sistent with (d)(9)(A).
Because the particular question in this case is whether SRS
falls within the definition of cosmetic surgery for which
expenses are disallowed in subsection (d)(9)(B), the majority
gives short shrift to subsection (d)(9)(A). Subsection (d)(9)(A)
shows the sorts of exceptional procedures for which Congress
meant to preserve deductions—i.e., procedures that are ‘‘nec-
essary to ameliorate a deformity arising from, or directly
related to, a congenital abnormality, a personal injury
resulting from an accident or trauma, or disfiguring dis-
ease’’—and thus illuminates the congressional purpose.
Someone like petitioner who suffers from GID has no deformi-
ties that are addressed by SRS; he has no ‘‘congenital abnor-
mality’’; he has suffered no ‘‘accident or trauma, or dis-
figuring disease.’’ There is thus no indication that Congress
explicitly intended to carve out, from its new disallowance,
an exception that would reach SRS expenses. The wording
choices in the statute that limit deductibility must be taken
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120 134 UNITED STATES TAX COURT REPORTS (34)
at face value in order to vindicate the undisputed congres-
sional purpose.
The majority not only ignores those implications of sub-
section (d)(9)(A) for the purpose of the statute but also ren-
ders much of (d)(9)(A) surplusage by its unduly loose
interpretation of subsection (d)(9)(B). Subsection (d)(9)(A)
provides that even if a procedure is ‘‘cosmetic surgery’’ (as
defined in (d)(9)(B)), its expenses will be deductible if (inter
alia) the procedure ‘‘ameliorate[s] a deformity arising from,
or directly related to, * * * disfiguring disease.’’ However, if
surgical procedures that mitigate the effects of disease
thereby fall outside the definition of ‘‘cosmetic surgery’’ (i.e.,
because they are deemed to ‘‘treat disease’’ in the broad
sense), then subsection (d)(9)(A) would describe an empty set
when it refers to ‘‘cosmetic surgery’’ that ‘‘ameliorate[s] a
deformity arising from * * * disfiguring disease.’’ If the
procedure ‘‘ameliorate[s]’’, and if to ameliorate is to ‘‘treat’’,
then the procedure would not be ‘‘cosmetic surgery’’ in the
first place. Anything that ‘‘ameliorates’’ would be deductible
because of the definition in (d)(9)(B), and the allowance in
(d)(9)(A) would have no effect.
On the other hand, if ‘‘treat * * * disease’’ in subsection
(d)(9)(B) is given its precise meaning (not excluding from
‘‘cosmetic surgery’’ a procedure that only mitigates the effects
of disease), then (d)(9)(A) would operate to allow a deduction
for cosmetic surgery that does not ‘‘treat’’ a disfiguring dis-
ease but rather ameliorates deformities arising from it. Thus,
only the precise meaning of ‘‘treat disease’’ in (d)(9)(B) har-
monizes with the allowance in (d)(9)(A).
3. Broader usage of the word ‘‘treat’’ by doctors does not
affect its significance in section 213(d)(9)(B).
It appears that doctors sometimes use the word ‘‘treat’’ in
this loose sense, so that they discuss SRS as a ‘‘treatment’’ for
GID. See majority op. pt. III.D.1. However, as the majority
indicates, majority op. p. 56, the meaning of statutory terms
is within the judicial province, and we do not generally
accept expert opinion on the meaning of statutory terms. In
testimony in this case, doctors manifestly used the terms
‘‘care’’ and ‘‘treatment’’ almost interchangeably, without par-
ticular attention to whether it is the patient, the symptoms,
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(34) O’DONNABHAIN v. COMMISSIONER 121
or the disease that is being addressed; in section 213(d), how-
ever, ‘‘care’’ is a general term of which ‘‘treatment’’ is a mode
distinct from ‘‘mitigation’’, and deductible care is directed to
‘‘disease’’ (or ‘‘illness’’), not to the patient or her symptoms.
There is thus no indication that doctors’ usage of these words
respects the distinctions that are important in section 213.
With the foregoing understanding of the purpose and oper-
ation of section 213(d)(9), I now address the question
whether SRS ‘‘treats’’ GID.
IV. SRS does not ‘‘treat’’ GID for purposes of section
213(d)(9)(B).
For the GID patient there is a dissonance between, on the
one hand, his male body (i.e., his male facial appearance, his
male body hair, his male body shape, his male genitalia, his
male endocrinology, and the Y chromosomes in the cells of
his body) and, on the other hand, his perception of himself
as female. The male body conflicts with the female self-
perception and produces extreme stress, anxiety, and
unhappiness.
One could analyze the GID patient’s problem in one of two
ways: (1) His anatomical maleness is normative, and his per-
ceived femaleness is the problem. Or (2) his perceived
femaleness is normative, and his anatomical maleness is the
problem. If one assumes option 2, then one could say that
SRS does ‘‘treat’’ his GID by bringing his problematic male
body into simulated conformity (as much as is possible) with
his authentic female mind.
However, the medical consensus as described in the record
of this case is in stark opposition to the latter characteriza-
tion and can be reconciled only with option 1: Petitioner’s
male body was healthy, and his mind was disordered in its
female self-perception. GID is in the jurisdiction of the psy-
chiatric profession—the doctors of the mind—and is listed in
that profession’s definitive catalog of ‘‘Mental Disorders’’. See
DSM–IV–TR at 576–582. When a patient presents with a
healthy male body and a professed subjective sense of being
female, the medical profession does not treat his body as an
anomaly, as if it were infected by the disease of an alien
maleness. Rather, his male body is taken as a given, and the
patient becomes a psychiatric patient because of his dis-
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122 134 UNITED STATES TAX COURT REPORTS (34)
ordered feeling that he is female. The majority concludes,
majority op. p. 76 (emphasis added), that GID is a ‘‘serious
mental disorder’’—i.e., a disease in petitioner’s mind—and I
accept that conclusion.
A procedure that changes the patient’s healthy male body
(in fact, that disables his healthy male body) and leaves his
mind unchanged (i.e., with the continuing misperception that
he is female) has not treated his mental disease. On the con-
trary, that procedure has given up on the mental disease,
has capitulated to the mental disease, has arguably even
changed sides and joined forces with the mental disease. In
any event, the procedure did not (in the words of Havey v.
Commissioner, 12 T.C. 412) ‘‘bear directly on the * * *
condition in question’’, did not ‘‘deal with’’ the disease (per
Webster’s), did not ‘‘treat’’ the mental disease that the thera-
pist diagnosed. Rather, the procedure changed only peti-
tioner’s healthy body and undertook to ‘‘mitigat[e]’’ the
effects of the mental disease.
Even if SRS is medically indicated for the GID patient—even
if SRS is the best that medicine can do for him—it is an
otherwise cosmetic procedure that does not ‘‘treat’’ the
mental disease. Sex reassignment surgery is therefore within
‘‘cosmetic surgery or other similar procedures’’ under section
213(d)(9)(A), and the expense that petitioner incurred for
that surgery is not deductible under section 213(a).
WELLS, FOLEY, VASQUEZ, and KROUPA, JJ., agree with this
concurring in part and dissenting in part opinion.
f
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