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OVERVIEW
HOLDING AND ANALYSIS
The IRS ruled that the children were attending the school principally to receive medical care in the form of special education in the years they were diagnosed as having a medical condition that hindered their ability to learn. Thus, the taxpayers can deduct tuition as a section 213(a) medical expense for the years the children continue to be diagnosed as medically handicapped. Citing revenue ruling 69-607, the IRS further held that dyslexia could be sufficiently severe as to be such a handicap. This ruling expands the types of tuition payments that may be deductible as medical expenses. It refutes the presumption that educational institutions must be “special schools” for their tuition to be deductible. It confirms that tuition for programs designed to enable dependents to deal with a diagnosed medical handicap—such as dyslexia—qualifies as a medical deduction, as long as other requirements are met.
LIMITS
Further, medical expenses are deductible only to the extent they exceed 7.5% of the taxpayer’s adjusted gross income. Finally, letter rulings apply only to the taxpayer who obtained the ruling; they are not precedential. However, they do show the service’s thinking on a particular issue. For more information, see the Tax Clinic, edited by Joel Ackerman, in the October 2005 issue of The Tax Adviser.
—Lesli S. Laffie, editor
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