New Fertility Tax Credit Offers 50% Refundable Relief, Capping Costs for Treatment Starting in 2025

The newly proposed Infertility Treatment Affordability Act of 2025 is creating a major new federal tax credit designed to cut the high cost of fertility treatments. Starting in the 2025 tax year, this bill adds a new Section 23A to the tax code, allowing eligible individuals to claim a tax credit equal to 50% of their qualified expenses for infertility treatment.

The Cost Break-Down: 50% Off and Refundable

This isn't just a deduction; it’s a direct credit, which is much more valuable. For a couple facing $30,000 in IVF costs, this credit could immediately knock off $15,000 from their tax bill. Crucially, up to $5,000 of the credit is refundable, meaning if your tax bill is zero, you could still get a check back for that amount. This refundable portion is a big deal, especially for lower- and middle-income families who might not owe much in federal taxes but still face crippling medical bills.

However, there are limits. The total credit amount is capped annually, and it phases out entirely if your Adjusted Gross Income (AGI) exceeds certain thresholds, ensuring the biggest benefits go to those outside the highest income brackets. For married couples, you must file a joint return to claim the credit. If you’re married but file separately—maybe for student loan purposes or other reasons—you won’t be able to access this benefit, which is a key restriction to note.

No Double-Dipping: Insurance and Deductions

To keep things fair and prevent people from claiming the same expense multiple times, the bill strictly prohibits “double benefits.” If you claim this credit, you cannot also deduct those expenses elsewhere on your taxes. More importantly for daily life, if your health insurance policy (or any federal, state, or local program) covers or reimburses you for the treatment, those specific expenses do not count toward the 50% credit. The intent is clear: this credit is meant to cover the out-of-pocket costs that insurance often leaves behind, not replace insurance coverage itself.

Defining Qualified Expenses: Beyond IVF

The bill defines “qualified expenses” as costs for infertility treatment provided by a licensed U.S. physician following an infertility diagnosis. Notably, the scope extends beyond standard treatments like IVF. It specifically includes fertility preservation costs—like egg or sperm freezing—but only if the procedure is done before medical treatments (such as chemotherapy or radiation) that a physician determines will cause infertility. If the preservation is done in advance of a procedure designed to cause infertility (i.e., voluntary sterilization), those costs are excluded. This provision is vital for cancer patients and others facing medically induced sterility, providing much-needed financial relief during an already difficult time. The definition of infertility itself is broad—the inability to get pregnant or carry a pregnancy to live birth—but explicitly excludes infertility or sterilization that was the intended result of a procedure.