Lost wages are never tax deductible. Your tax “reduction” is the fact that if you have fewer wages, you already pay less tax. You can’t subtract some thing out of your income that was never included in your income in the first place.
The New York organ donor support act was just signed into law three days ago. It appears to create a reimbursement program for lost wages and other expenses that will be managed through the New York State Department of Health, not the Department of Taxation and Finance. You will have to wait and see until the program is created, to learn how it will be administered, and how to obtain reimbursement. It will probably not be through the tax return. Additionally, you may not be eligible for reimbursement if you were an organ donor before the law was signed into effect.
The new law says nothing about a special tax deduction for unreimbursed medical expenses for organ donation. If there is a pre-existing special deduction for organ donation under New York State income tax, that will be in the New York State module. You can still list your eligible expenses on your federal return and they will be subject to the usual 7.5% limitation. Then when you enter the New York State section, you will want to pay attention to the pages that list special New York State additions and subtractions to income. If there is a special deduction for organ donation expenses, it will be listed there.
at the present time, you can only deduct your out-of-pocket costs including travel, food, and lodging, using the IRS required maximum rates. Also note that in the future, if you obtain tax free reimbursement from New York State or any other agency or insurance company for your medical expenses, you can’t take a tax deduction for them unless you include the reimbursement in your taxable income. That would be double dipping — you can’t take a tax deduction for some thing that was reimbursed tax free.
