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So, you’ve donated your eggs (or you’re thinking about it) and now you’re staring at your tax forms with a raised eyebrow. That check you received for your time, effort, and, let’s be honest, a not-so-fun medical process, seemed like a well-earned thank you. But here’s the reality: the IRS sees it a bit differently. If you were hoping Uncle Sam might give you a pass because you did something amazing for someone else, well, let’s just say he’s not known for his sentimentality.

Let’s walk through exactly how taxes work when you’ve been compensated for donating eggs, and what, if anything, you can write off.

How Egg Donor Compensation Is Classified

Let’s start with what surprises many donors: yes, that compensation is taxable. Even if your motivation was pure and your heart was in the right place, the IRS doesn’t deal in emotions. It deals in income. And to them, your egg donation is a service rendered, plain and simple.

Think of it this way: when you do freelance work or sell something on Etsy, you’re expected to pay taxes on your earnings. Egg donation works the same way. You provided something valuable in exchange for money, and that means the IRS wants a slice of the pie.

You’ll likely get a 1099-MISC form from the agency if you earned more than $600. But here's a kicker: even if you don’t get that form, the income still counts. You’re legally required to report it. 

IRS Guidelines on Egg Donation Income

According to Perez v. Commissioner, the court confirmed that egg donor compensation is taxable income. The ruling made it clear that this money isn’t a gift. It’s not a reimbursement. It’s not compensation for pain or suffering either, even if you had to cancel plans, stick yourself with hormone shots for weeks, or lie around after retrieval.

And yes, some people found out the hard way. Some donors didn’t report their income, assuming it was too small or somehow exempt. Then came the penalties, the late fees, and in some cases, IRS audits. 

Can Medical Expenses Be Deducted?

This is where things get a little complicated. In theory, medical expenses can be tax-deductible. But in the egg donation world, donors rarely pay their medical bills. The intended parents or the fertility clinic, like Nevada Center For Reproductive Medicine, usually cover everything from the first screening to the final checkup.

That means you can’t deduct medical costs you didn’t actually pay. If you didn’t swipe your credit card, you don’t get to claim it on your taxes.

That said, there are rare cases where donors do pay something out-of-pocket. Maybe you paid for a prescription the agency wouldn’t cover. Or you booked a recovery massage on your own dime. If those expenses are substantial, and you itemize your deductions, they might qualify. 

But there’s a catch. The IRS only lets you deduct unreimbursed medical expenses that go over 7.5% of your adjusted gross income. For most people, that’s a pretty high hurdle. Unless you had a really expensive year health-wise, those few extra costs won’t add up enough to qualify.

What About Other Types of Expenses?

Now we’re getting into the gray areas. And when it comes to taxes, gray areas are where mistakes happen, so it’s best to be cautious.

Travel expenses: If you had to travel to a different city for your egg donation cycle and the agency didn’t reimburse you, those costs might be deductible. But only if you're filing as self-employed or your income situation meets very specific criteria.

Lost wages: Some donors take time off work to recover, but that lost income generally isn’t deductible. The IRS doesn’t offer a write-off for days missed due to elective medical procedures, and egg donation often falls into that category in their eyes.

Lodging and meals during travel: This only counts if you weren’t reimbursed, and only under certain conditions.

Simply put- unless your situation is unusual, these types of deductions won’t help much. But it never hurts to ask a tax professional to take a look.

Tax Filing Tips for Egg Donors

Whether this was your first cycle or your third, here’s how to prep for tax season so you don’t find yourself panicking on April 14:

Keep Records

Emails, contracts, travel receipts, and appointment reminders should all be saved. If there’s even a chance you might need to prove something down the line, you’ll be glad you held onto it.

Reach Out for Your 1099

If you haven’t received a tax form by the end of January, don’t just assume one isn’t coming. Contact your agency and ask for it. Some only send it upon request.

Report Your Income Honestly

Even if you didn’t get a 1099, you’re still required to report the income. The IRS can match reports from multiple sources, and unreported income can trigger penalties and audits.

Consider Quarterly Estimated Payments

This is especially important if egg donation is just one stream of freelance or gig income. If you’re earning income without tax being withheld, you might owe quarterly estimated taxes to avoid penalties. A CPA can help you calculate and schedule these.

Ask About Possible Deductions

There might be small deductions related to your donation, especially if you weren’t reimbursed for travel or lodging, but these are case-by-case. Always check with a qualified professional before assuming you qualify.

FAQs

Can I write off my egg donor medical expenses?

Not usually. Most donors don’t pay their medical bills, so there’s nothing to deduct. If you did pay something out-of-pocket and meet the IRS guidelines, you could qualify, but it’s rare.

Do I have to report egg donor compensation if I didn’t get a tax form?

Yes, absolutely. The law requires you to report any income, whether you received a 1099 or not.

Is there any way this income could be tax-free?

Not under current laws. Compensation for egg donation is considered taxable income. That won’t change unless the IRS or Congress changes the rules.

Can I deduct my travel or hotel stay during the process?

Only if you paid for it yourself and weren’t reimbursed. And even then, only in very limited situations. Don’t try to claim anything without double-checking with a tax advisor.

Will I owe a lot in taxes on my compensation?

It depends on how much you made in total last year. If the egg donation payment was your only income and it fell below the standard deduction (about $13,850 for single filers in 2023), you might owe very little or nothing. But if you had other income, your donor earnings could increase your tax bill.

Final Thoughts

Egg donation is a generous, complex process. It asks a lot from you emotionally and physically. But once it’s over, you’re not entirely done; there’s still the paperwork. Taxes may not be as intense as hormone injections or retrieval day, but they matter.

When you understand how your compensation is viewed by the IRS, you can handle your taxes with confidence instead of confusion. And being financially prepared means you get to focus on the meaningful part of the experience: knowing that you made a difference in someone’s life.