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Taxation of fertility benefits


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We are looking at the taxation of benefits to provide for egg extraction and freezing.  

Publication 502 provides that:

Quote

You can include in medical expenses the cost of the following procedures to overcome an inability to have children.

-Procedures such as in vitro fertilization (including temporary storage of eggs or sperm).

Two questions:

  1. Does the reference to "overcome an inability to have children" refer only to a current inability to have children, or a future inability?  For example, suppose someone has cancer, and is just about to have radiation treatments that will forever eliminate the ability have children--can we provide IVF on a tax-free basis?  What about someone who is trans, who is about to enter hormone treatment that may impair fertility?  Or what about someone who is 35 now and has no partner, but wants to preserve eggs for later when her fertility may have declined?
  2. How long is "temporary" storage?  I have heard, though been unable to locate documentation,  that John Sapienza, IRS Office of Chief Counsel, made  remarks at a May 2002 ECFC Teleconference that "temporary" might mean that eggs were stored and used within the same year.  Obviously, that would in many instances be insufficient even in the case of current infertility (for someone who took a long time to get pregnant, or wanted to have a second child).  And it would certainly be insufficient in instances such as those described in 1, above.

Has anyone had any formal or informal contact with the IRS on either of these questions?  Or does anyone have a copy of Sapienza's remarks?

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

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I checked BNA.  Pension & Benefits Daily (and the weekly Reporter) ran an article on the Employee Council on Flexible Compensation's 15th Annual Cafeteria Plan Symposium on August 16, 2002.  The article summarizes Harry Becker's remarks, but none of John Sapienza.

 

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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Thanks for trying!  There is just so little guidance on what seems to me like an obvious issue.

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

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