*100 Decision will be entered for the respondent.
The petitioners' son was of normal intelligence but had difficulty reading. His lack of reading proficiency was caused, at least to some extent, by his emotional problems. The petitioners enrolled their son in a private school that provided an academic program with emphasis upon remedial reading. Held, the school was not a "special school" within the meaning of sec. 1.213-1(e)(v)(a), Income Tax Regs.Held, further, no part of the tuition was paid to the school for medical care within the meaning of sec. 213(e)(1), I.R.C. 1954.
*101 *1442 The respondent determined deficiencies in petitioners' income taxes as follows:
| Calendar year | Deficiency |
| 1964 | $ 2,733.53 |
| 1965 | 1,494.25 |
The petitioner's concede that expenses of their daughter's attendance at a summer camp were not medical expenses. This leaves for decision the question of whether amounts paid by the petitioners in connection with their son's attendance at Matthews School were expenses for "medical care" within the meaning of section 213. 1
FINDINGS OF FACT
Some of the facts have been stipulated. The stipulation and exhibits thereto are incorporated herein by this reference.
The petitioners Paul H. and Carolyn Ripple are husband and wife. At the time of the filing of their petition, the petitioners were residents of Lancaster, Pa. For the taxable years here in question, the petitioners jointly filed their income tax return on a calendar year basis with the district director of internal revenue, *102 Philadelphia, Pa.
Petitioners have three children. Their oldest child, David, was born on May 30, 1948.
In 1952 David Ripple was sent to a private kindergarten. The kindergarten was run by a psychologist who noticed certain aggressive behavior on David's part.
*1443 David Ripple then attended public school in Lancaster. It was necessary for David to repeat the second grade and later to repeat the sixth grade. In addition to difficulties with reading, David had problems with arithmetic and other subjects. David received private tutoring to aid him in his academic work and occasionally received counseling at the Child Guidance Clinic at Lancaster. David was also taken to a psychiatrist.
In 1962 David Ripple was tested at the Reading Clinic of the Department of Psychology at Temple University in Philadelphia. A report based on that testing stated that David had problems in reading, emotional adjustment, and inconsistent ability to attend and to concentrate. However, based on the test results of the Wechsler Intelligence Scale for Children, the report placed David in the bright normal range of the American population. The report stated that David had "the sort of reading*103 disability known as severe corrective with emotional components." The report concluded with the following recommendations:
Personal AdjustmentThe extent of David's personal adjustment problem and the degree to which it has affected his capacity to learn makes psychiatric help in this area key to any program of remediation for him.
Educational NeedsA full-time school program of reading help would be the optimum situation for David, such as that offered by the Matthews School. * * *
The petitioners followed the recommendation of this report and entered their son in the Matthews School in January 1964. David Ripple remained at the school until August 1965.
The Matthews School was founded in 1941 by Miss Helen Matthews. She was the director of the school from its founding in 1941 until June 10, 1965, the date of her retirement due to ill health. Prior to founding the Matthews School, Miss Matthews was a school psychologist in Scranton, Pa., for 14 years. She holds a B.A. and M.A. degree in psychology. Miss Matthews is also a diplomate in clinical psychology and is certified by the Pennsylvania Psychological Association.
At the time of David Ripple's attendance, *104 the Matthews School had a staff of six full-time teachers, one part-time teacher, and an enrollment of 39 students. Miss Matthews testified that the teachers all had special training in the teaching of reading and some held degrees in psychology.
The Matthews School provided an academic program with emphasis upon corrective and remedial reading. The curriculum was ungraded but a student was ultimately graded as to his progress in reading, arithmetic, social studies, or other subjects. Miss Matthews testified that the school directed itself towards the educational problems of children who had both emotional and educational problems.
*1444 During the years 1964 and 1965, the Matthews School was licensed by the Commonwealth of Pennsylvania, Department of Public Instruction, to operate a private academic school or class in the fields of "Corrective and Remedial Instruction -- Elementary and Secondary Education." The school was not licensed for socially and emotionally disturbed children and did not maintain a staff to provide psychiatric care. However, Dr. Jules Abrams, a clinical psychologist, was associated with the Matthews School as a consultant.
During the period that David*105 Ripple attended the Matthews School, he received psychotherapy from Dr. Abrams. Dr. Abrams discussed David's emotional problems with the staff of the school.
In July 1965, 1 month prior to the time when David left the Matthews School, Mr. Gerald Schatz replaced Miss Matthews as director of the school. Mr. Schatz currently is the owner of the school. Mr. Schatz has a masters degree in psychology and education and has been qualified as a psychologist by the Pennsylvania Psychological Association.
Mr. Schatz had daily contact with David Ripple during the spring and summer of 1965 in his capacity as a teacher at the school. Contrary to Miss Matthews, Mr. Schatz testified that the school's function was to help David overcome his emotional difficulties that were based on severe anxiety and make it possible for him to be educated. At the time of trial, the Matthews School was licensed to treat emotionally and socially disturbed children.
The Matthews School provided David Ripple with room and board from January 1964 until September 1964. From September 1964 until David stopped attending the Matthews School after the school's summer session in August 1965, he obtained his room and board*106 at the residence of a Mrs. Oberholtzer.
After leaving the Matthews School, David Ripple attended Cornwall Academy, and at the time of trial was receiving vocational training at the Harrisburg Area Community College.
During the taxable years 1964 and 1965, the petitioners paid the following amounts to the Matthews School:
| Semester from Jan. 27, 1964, through June 11, 1964: | |
| Tuition | $ 1,400 |
| Room and board | 800 |
| Total | 2,200 |
| Six week summer session, 1964: | |
| Tuition | $ 500 |
| Room and board | 250 |
| Total | 750 |
| Semester from Sept. 14, 1964, through Jan. 22, 1965: | |
| Tuition | $ 1,550 |
| Room and board | n2 800 |
| Total | 2,350 |
| Semester from Feb. 1, 1965, through June 10, 1965: | |
| Tuition | $ 1,550 |
| Room and board | n2 800 |
| Total | 2,350 |
| Six week summer session, 1965: | |
| Tuition | $ 500 |
| Room and board | 2 250 |
| Total | 750 |
*1445 The petitioners paid Dr. Jules Abrams $ 460 in 1964 and $ 740 in 1965 for*107 psychotherapy received by their son.
In their returns for their taxable years 1964 and 1965 the petitioners deducted the tuition and room and board paid to the Matthews School in the respective amounts of $ 5,300 and $ 2,925 designating such amounts as the "Cost of Care of Mentally Deficient Child." The petitioners also deducted $ 220 and $ 660 in those years as medical expenses paid to Dr. Jules Abrams.
The respondent did not question the character of the payments made to Dr. Abrams. However, the respondent disallowed the deductions claimed on account of payments to the Matthews School and to the summer camp. As a result of these adjustments, the petitioners' medical expenses did not exceed 3 percent of their adjusted gross income for calendar 1964 and 1965.
OPINION
Section 213 of the Code allows a deduction for amounts paid for medical care for the treatment of a dependent suffering from a disease. 3
*108 David Ripple possessed the mental ability to read but had problems reading. His lack of reading proficiency was caused, at least to some extent, by his emotional difficulties. Expenditures made by the petitioners *1446 to treat their son's emotional difficulties would fall within the definition of medical care. See C. Fink Fischer, 50 T.C. 164 (1968); Hobart J. Hendrick, 35 T.C. 1223 (1961).
The petitioners contend that the entire amount of the tuition paid Matthews School along with the amounts paid for room and board are deductible as expenses for medical care. They base their contention on the regulations relating to institutionalized care which provide that for educational costs and meals and lodging to be treated as medical expenses the individual must attend a "special school" with resources for alleviating a given mental or physical handicap, and these resources must be a principal reason for the individual's presence there. 4
*109 *1447 An institution will be considered a "special school" within the meaning of the regulations where education is only "incidental" to medical care. See C. Fink Fischer, supra;Arnold P. Grunwald, 51 T.C. 108">51 T.C. 108 (1968). During the period of David Ripple's attendance, the Matthews School provided an academic program with emphasis upon corrective and remedial reading. The school was described by its founder and director as providing for the educational problems of children who had both educational and emotional problems. 5 At the Matthews School, the training in remedial reading, which the petitioners tacitly recognize to be an educational rather than a medical service, was not incidental to medical care. Education was the primary function. The Matthews School was not a "special school" within the meaning of the regulations. Accordingly, the expenses of the meals and lodging were not for medical care but were nondeductible personal expenses.
*110 In addition, the petitioners paid tuition to the Matthews School in calendar 1964 and 1965 in the respective amounts of $ 3,450 and $ 2,050. Only if, and to the extent that, such fees were for the mitigation or treatment of David Ripple's emotional problems, would those fees be deductible expenses for medical care. See C. Fink Fischer, supra;Hobart J. Hendrick, supra.
Whether a service constitutes medical care depends upon its therapeutic nature to the individual involved. See C. Fink Fischer, supra; Rev. Rul. 67-339, 2 C.B. 126">1967-2 C.B. 126. There must be a proximate relationship between the medical deficiency of the individual and the service he received. Arnold P. Grunwald, supra.It must be established that the tuition was paid for services provided by the Matthews School which with respect to David were primarily medical in nature rather than educational.
The petitioners do not argue that the remedial reading classroom instruction in itself mitigated or treated their son's disease. They apparently view this instruction*111 along with any education that their son may have received as being incidental to a therapeutic program designed in conjunction with the individual psychotherapy supplied by Dr. Abrams to break down their son's inhibitions to learning. The petitioners do claim that the efforts of the Matthews School were devoted to overcoming their son's psychological impediment to learning. They argue that their son received classroom therapy at the Matthews School that supported the individual therapy that he received from Dr. Abrams. The record in this case does not support the petitioners' contentions.
*1448 No evidence was introduced as to the actual nature of the classroom instruction or how that instruction was designed to deal with David Ripple's emotional problems, as well as his academic deficiencies. Miss Matthews, who was the director of the school, for all but 1 month of the approximately 1 1/2 years that David Ripple was enrolled, stated that the classroom instruction was directed towards the correction of reading deficiencies. She did not indicate that the classroom instruction was designed to be therapeutic.
The report issued by the Reading Clinic of the Department of Psychology*112 at Temple University recommended psychiatric help to overcome David Ripple's inability to learn and reading help such as that offered by the Matthews School. The report called for separate approaches to solve David Ripple's emotional and academic problems.
David Ripple attended the Matthews School and contemporaneously received psychiatric services from Dr. Abrams. While Dr. Abrams discussed David Ripple's condition with his teachers, there was no evidence that they provided supportive therapy or modified their remedial reading program to overcome David Ripple's emotional problems.
The petitioners failed to show that classroom services provided by the Matthews School had a direct or proximate therapeutic effect on their son's disease. Compare C. Fink Fischer, supra.
On the record in the instant case, we must conclude that no part of the amount paid to the Matthews School was for medical care.
Decision will be entered for the respondent.
Footnotes
1. All section references are to the Internal Revenue Code of 1954, as amended.↩
2. The Matthews School paid these amounts to Mrs. Oberholtzer for David's room and board.↩
3. SEC. 213. MEDICAL, DENTAL, ETC., EXPENSES.
(a) Allowance of Deduction. -- There shall be allowed as a deduction the following amounts of the expenses paid during the taxable year, not compensated for by insurance or otherwise, for medical care of the taxpayer, his spouse, or a dependent (as defined in section 152) --
* * * *
(e) Definitions. -- For purposes of this section --
(1) the term "medical care" means amounts paid --
(A) for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body (including amounts paid for accident or health insurance) * * *↩
4. Sec. 1.213-1, Income Tax Regs.:
(e) Definitions -- (1) General. (i) The term "medical care" includes the diagnosis, cure, mitigation, treatment, or prevention of disease. Expenses paid for "medical care" shall include those paid for the purpose of affecting any structure or function of the body, for accident or health insurance, or for transportation primarily for and essential to medical care. * * *
(ii) Amounts paid for operations or treatments affecting any portion of the body, including obstetrical expenses and expenses of therapy or X-ray treatments, are deemed to be for the purpose of affecting any structure or function of the body and are therefore paid for medical care. Amounts expended for illegal operations or treatments are not deductible. Deductions for expenditures for medical care allowable under section 213 will be confined strictly to expenses incurred primarily for the prevention or alleviation of a physical or mental defect or illness. Thus, payments for the following are payments for medical care: hospital services, nursing services (including nurses' board where paid by the taxpayer), medical, laboratory, surgical, dental and other diagnostic and healing services, X-rays, medicine and drugs (as defined in subparagraph (2) of this paragraph, subject to the 1-percent limitation in paragraph (b) of this section), artificial teeth or limbs, and ambulance hire. However, an expenditure which is merely beneficial to the general health of an individual, such as an expenditure for a vacation, is not an expenditure for medical care.
* * * *
(v) The cost of in-patient hospital care (including the cost of meals and lodging therein) is an expenditure for medical care. The extent to which expenses for care in an institution other than a hospital shall constitute medical care is primarily a question of fact which depends upon the condition of the individual and the nature of the services he receives (rather than the nature of the institution). A private establishment which is regularly engaged in providing the types of care or services outlined in this subdivision shall be considered an institution for purposes of the rules provided herein. In general, the following rules will be applied:
(a) Where an individual is in an institution because his condition is such that the availability of medical care (as defined in subdivisions (i) and (ii) of this subparagraph) in such institution is a principal reason for his presence there, and meals and lodging are furnished as a necessary incident to such care, the entire cost of medical care and meals and lodging at the institution, which are furnished while the individual requires continual medical care, shall constitute an expense for medical care. For example, medical care includes the entire cost of institutional care for a person who is mentally ill and unsafe when left alone. While ordinary education is not medical care, the cost of medical care includes the cost of attending a special school for a mentally or physically handicapped individual, if his condition is such that the resources of the institution for alleviating such mental or physical handicap are a principal reason for his presence there. In such a case, the cost of attending such a special school will include the cost of meals and lodging, if supplied, and the cost of ordinary education furnished which is incidental to the special services furnished by the school. Thus, the cost of medical care includes the cost of attending a special school designed to compensate for or overcome a physical handicap, in order to qualify the individual for future normal education or for normal living, such as a school for the teaching of braille or lip reading. Similarly, the cost of care and supervision, or of treatment and training, of a mentally retarded or physically handicapped individual at an institution is within the meaning of the term "medical care."↩
5. It appears from the conflicting testimony of Miss Matthews and Mr. Schatz that the character of the school changed after Mr. Schatz became director. However, we are not concerned here with the character of the school other than at the time David Ripple was enrolled.↩