A recent IRS Letter Ruling (202518023, May 2025) clarifies medical expense deductions under Sec. 213, approving unreimbursed IVF costs while denying those for surrogacy. As reported in The Tax Adviser (November 2025), this guidance helps Intended Parents navigate tax implications amid rising fertility costs.
Under Sec. 213, taxpayers can deduct medical expenses exceeding 7.5% of AGI if for diagnosis, cure, or prevention of disease affecting body structure/function. The ruling allows deductions for IVF screenings, fertility meds, treatments, and egg/sperm retrieval performed on the taxpayer or spouse, as these directly impact their bodies. However, surrogacy expenses—like the carrier’s care, insurance, legal fees, and compensation—are non-deductible, as they benefit a third party, not the taxpayer/spouse/dependent.
This aligns with cases like Magdalin (T.C. Memo. 2008-293) and Morrissey (871 F.3d 1260), where similar claims were rejected. For surrogacy families, it means focusing deductions on qualifying IVF portions, potentially saving thousands amid $12,000–$25,000 per cycle costs.
At Conceptual Options, we’ve empowered families since 1999 with ethical surrogacy.
To claim deductions, maintain detailed records distinguishing IVF from surrogacy fees. Consult a tax professional—we partner with experts to ensure compliance. With 1 in 6 facing infertility, these ruling underscores planning’s importance.
Our Las Vegas Egg Donation acquisition expands affordable options, blending compassion with financial savvy. Whether same-sex couples, singles, or those with medical needs, we make family-building accessible.
Inspired to build your family tax-smart? Visit Conceptual Options to explore surrogacy today—your miracle, minus the financial stress.
Want to learn more about Surrogacy, Egg Freezing, IVF, Embryo Donation, and Egg Donation? Please contact us today at www.ConceptualOptions.com or by calling 858-748-4222 to learn more about how Surrogacy and Egg Donation can be right for you.
