To amend the Internal Revenue Code of 1986 to treat amounts paid for private umbilical cord blood, or umbilical cord tissue, banking services as medical care expenses.
Sponsors
Legislative Progress
IntroducedMr. Arrington (for himself, Mr. Panetta, and Mr. Davis of …
Summary
What This Bill Does
This bill allows families to deduct the cost of private umbilical cord blood and tissue banking from their federal income taxes as a medical expense. Currently, the IRS does not recognize cord blood banking as a deductible medical expense. Under this bill, families could claim these costs on their tax returns starting in 2025, as long as they use an accredited bank that complies with federal health regulations.
Who Benefits and How
Families with newborns who choose to bank their baby's cord blood or tissue would benefit by reducing their tax burden. The typical cost is $1,000-$2,000 upfront plus annual storage fees. Private cord blood banking companies would also benefit from increased demand as the tax deduction makes their services more affordable to customers. Higher-income families would see the largest tax savings since they pay higher marginal tax rates and are more likely to afford cord blood banking in the first place.
Who Bears the Burden and How
The federal government and ultimately all taxpayers bear the burden through reduced tax revenue. This bill creates a new tax expenditure - the government will collect less income tax from families who claim this deduction. The amount of lost revenue depends on how many families choose to bank cord blood and their income levels.
Key Provisions
- Adds private umbilical cord blood and tissue banking services to the list of deductible medical expenses under Internal Revenue Code Section 213(d)(1)
- Requires banking services to be provided by accredited banks in compliance with Public Health Service Act regulations (42 U.S.C. 264)
- Takes effect for tax years beginning after December 31, 2024
- Families can only deduct medical expenses that exceed 7.5% of their adjusted gross income, so not all families will benefit equally
Evidence Chain:
This summary is derived from the structured analysis below. See "Detailed Analysis" for per-title beneficiaries/burden bearers with clause-level evidence links.
Primary Purpose
Expands medical expense tax deductions to include private umbilical cord blood and tissue banking services
Policy Domains
Legislative Strategy
"Provide tax incentives for families to bank umbilical cord blood and tissue by making it a deductible medical expense"
Likely Beneficiaries
- Families with newborns who choose to bank cord blood/tissue
- Private cord blood banking companies
- Taxpayers in higher tax brackets who benefit more from deductions
Likely Burden Bearers
- Federal government (reduced tax revenue)
- Other taxpayers (who indirectly bear cost of tax expenditures)
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "irs"
- → Internal Revenue Service
- "treasury"
- → Department of Treasury
Key Definitions
Terms defined in this bill
Banking services provided by any accredited bank which is in compliance with the regulations under section 361 of the Public Health Service Act (42 U.S.C. 264)
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology