IRS says no to deductions for marijuana.

The Internal Revenue Service ruled that an amount paid to obtain marijuana for medical purposes is not a deductible medical expense, even if the marijuana was obtained with a prescription issued by a physician in accordance with state law.

Under Internal Revenue Code section 213, medical expenses can be deducted if they exceed 7.5% of a taxpayer's adjusted gross income. Some states allow use of marijuana for medical purposes; however, the Clinton administration has publicly stated it is opposed to medical use of mariJuana even though some medical professionals believe its use eases the patient's pain and suffering.

Under revenue ruling 97-8, a taxpayer purchased marijuana and used it to treat a disease in accordance with state law. The IRS said that because marijuana was listed as a controlled substance on schedule I of the federal Controlled Substances Act (CSA)-- which supersedes the state's authority-it was not "legally procured" and the taxpayer could not deduct as a medical expense the amount paid to purchase it. Generally, the CSA does not permit the possession of controlled substances listed, even for medical purposes and even with a physician's prescription.

This ruling also makes obsolete a previous revenue ruling (78-325), which held that payments for laetrile for the purpose of treating cancer-related illness were deductible under section 213 when purchased and used in a locality where it was legal.

Revenue ruling 97-9 was published in Internal Revenue Bulletin 1997-9 on March 3, 1997.