## Facts

- A taxpayer (“A”), on a physician’s recommendation, purchased and used marijuana to treat a disease.
- A resided in a state that permitted the purchase and use of marijuana for medical purposes.
- Marijuana is a Schedule I controlled substance under the federal Controlled Substances Act (CSA).
- The CSA generally prohibits possession of Schedule I substances, including for medical purposes and even with a physician’s prescription.
- A’s purchase and use were lawful under state law but unlawful under federal law.

## Issues

1. Whether amounts paid to obtain a controlled substance for medical purposes, in violation of federal law, are deductible medical-care expenses under I.R.C. § 213.

## Decision

- The IRS concluded that the expense is not deductible under I.R.C. § 213.
- A controlled substance obtained in violation of the CSA is not “legally procured” for purposes of Treas. Reg. § 1.213-1(e)(2).
- Because the drug is not “legally procured,” amounts paid to obtain it do not qualify as deductible medical expenses, notwithstanding state-law authorization.

## Legal Principles

- I.R.C. § 213 permits a deduction for qualifying medical-care expenses, including certain medicine or drug costs, subject to statutory limitations.
- Under I.R.C. § 213(b) and § 213(d)(3), amounts paid for “medicine or a drug” qualify only if the item is a prescribed drug (or insulin) within the statutory definition.
- Treas. Reg. § 1.213-1(e)(2) limits “medicine and drugs” to items that are “legally procured.”
- Treas. Reg. § 1.213-1(e)(1)(ii) excludes amounts expended for illegal operations or treatments.
- For the “legally procured” requirement, federal law controls; state authorization does not render a Schedule I controlled substance lawful for federal tax-deduction purposes.

## Conclusion

Revenue Ruling 97-9 states that a taxpayer may not deduct amounts paid for medical marijuana under I.R.C. § 213 when the acquisition and possession of the drug violate the CSA, even if state law permits its medical use and a physician recommends it.


Rev. Rul. 97-9, 1997-1 C.B. 77 (1997)