Tax Consequences of Surrogacy

[VaGirl]

Hi Ladies-

We are IPs whose GS is due with a baby boy in June! In getting our medical expenses together for our tax preparer I'm wondering if anyone can tell me if any portion of the surrogacy journey is tax deductible. Are the actual medical expenses paid to the clinic deductible? Are the legal fees paid to the attorney deductible? I'm sure that the payments we've made to our surrogate are not, but does anyone have any advice for us? I've been around these BBs off and on for 7 years and seem to remember some past info about this issue. If anyone can give me any advice, I would appreciate it-

VaGirl

[BC-MAV]

WE have itemized our taxes for the past several years. WE itemize business deductions, charitable deductions, and medical deductions. When we were doing IVF that was a BIG dedcution. The amount you can deduct is what is over 7.5% of your income (check on that figure).

What is dedcutable is Dr visits for YOU, blood tests, medicines... woohoo thats a fortune, diagnostic tests, procedures.... wahoo those IUI's and IVF's cost a LOT, faxes of info to Dr., long distance phone consults, a certain portion of the mileage to and from Dr. and I'm not sure about air fare to and from Dr. if you are travelling from another state. Add in your insurance premiums, dentist visits, eye Dr. visits, dermatolgist visits, other RX, no prescription stuff like glasses, contacts, contact solution, etc... and you have a lot of stuff to deduct. You can NOT deduct expenses that are NOT on you... ie your egg donor's IVF or you SM's transfer or your SM's histosonogram... because that's a third party and the insurance is for you. Egg donors or sperm donors are not your children or you dependants so you can't claim them on your taxes so you can't claim them as deductions.

Hope that helps you understand. If in doubt ask your accountant or consult JK Lassers guide to taxes.

[VaGirl]

That's kind of what I thought that it had to be for ME to count.....Thanks for the reply-

VaGirl

[BC-MAV]

Glad to be of help. Oh and save every little receipt and perhaps do an excel spread sheet. I did that every year and I can't WAIT for the IRS to say "wait a minute"... then I will hand them the receipts in a little ball. THEN, if they say they need more proff I will give them the handy dandy neat spread sheet to prove we really did spend that much to have our precious boys!

[BC-Sirell]

MAV gave you some excellent advice. You might also want to speak to a tax advisor or someone at H&R Block just to be sure.

Good luck!

Hugs,


Sirell