20 February 2012 External T.I. 2012-0436991E5 - medical expense - undergarments

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Principal Issues: Whether the cost of undergarments used to hold a breast prosthesis in place after a mastectomy qualify as medical expenses for purposes of the medical expense tax credit?

Position: No.

Reasons: Regulation 5700(j) prescribes an external breast prosthesis that is required because of a mastectomy but there is no provision to allow the cost of undergarments to hold an external breast prosthesis in place.

XXXXXXXXXX 

									2012-043699

February 20, 2012

Dear XXXXXXXXXX :

Re: Medical Expense Tax Credit

This is in response to your letter of February 15, 2012, inquiring about whether the cost of undergarments required to hold a prosthesis in place after a mastectomy qualify as medical expenses for purposes of the medical expense tax credit ("METC"). In particular, you are referring to the special undergarments and bathing suits that must be worn to hold the prosthesis in place.

Our Comments

Medical expenses which are eligible for the METC are limited to those described in subsection 118.2(2) of the Income Tax Act (the "Act"). If a particular expenditure is not described as an eligible medical expense in subsection 118.2(2) of the Act, or if the conditions under which the expenditure would qualify are not met, the expenditure does not qualify for purposes of the METC, even though the expenditure may have been incurred for medical reasons.

Paragraph 118.2(2)(m) allows a deduction for medical equipment prescribed in section 5700 of the Income Tax Regulations (the "Regulations") that are prescribed by a medical practitioner and meet the conditions that have been prescribed as to its use or the reason for its acquisition. Paragraph 5700 (j) of the Regulations prescribes an external breast prosthesis that is required because of a mastectomy as an eligible medical device. However, there is no provision that permits the cost of undergarments required to keep a prosthesis in place after a mastectomy to qualify as a medical expense for purposes of the METC under subsection 118.2(2) of the Act.

We trust that these comments will be of assistance.

Yours truly,

G. Moore
for Director
Trusts and Business Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch