Gestational Surrogacy and Filing Your Taxes

As the post-holiday excitement comes to a close and we steady our footing in the new year, many of us begin to look toward the next yearly milestone: tax season! While filing taxes is typically a standard annual routine, this is not the case for everyone, especially following a year with a major life change – including surrogacy! One of the biggest questions facing Gestational Surrogates and Intended Parents alike is what can and cannot be deducted. Although navigating tax documents can be incredibly overwhelming, we understand going straight to a tax preparation specialist is not always an option. To make the 2017 tax season as smooth, efficient, and easy to understand as possible, we’ve outlined the three main questions we receive the most in regard to tax season and Surrogacy:

  1. Whose expenses can you deduct?
    Medical expenses are typically only covered for the taxpayer, spouse of the taxpayer, and taxpayer’s dependents – this does not include surrogates, egg donors, or unborn children.
  2. How much can you deduct?
    In order to claim deductions, they must be itemized and exceed 10 percent of your adjusted gross income. The exception to this rule is where medical expenses come into play, which can be deducted when they exceed 7.5 percent of adjusted gross income.
  3. Which expenses can you deduct?
    Because signing a legal contract is necessary for the medical care involved in surrogacy, legal fees are completely deductible. Additionally, transportation and lodging costs for egg transfer and sperm donation can be deducted for both travelers, provided it is within reason and not excessive.

Taxes vary from state to state and can seem even trickier where surrogacy is concerned. Although the above guidelines address the most common questions associated with surrogacy and tax deductions, working with a tax attorney is the best way to ensure you are compliant with all state, local, and federal tax regulations while also making the most of your deductions. If you are looking for additional information on surrogacy and filing your taxes, contact the surrogacy experts today at Surrogate Solutions for professional assistance!



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