According to Wikipedia, Caroline Cossey was actually XXXY.
That being said, Amlord, you have a gross misunderstanding of transgendered people. Oftentimes, as Entspeak has pointed out, people are born hermaphrodites, and they are assigned a gender at birth, in hopes of having those children leave normal lifestyles. However, sometimes those gender assignments are wrong. Additionally, sometimes boys are reassigned as girls because of accidents during circumcision. Of course, there is a growing number of seemingly "normal" girls and boys who do not feel comfortable with their gender from birth.
Although gender identity disorder is considered a mental disorder, it is highly controversial in that classification; AND most doctors do not agree with "conversion" therapy.
From WikiQUOTE
Today, most medical professionals who provide transgender transition services now reject conversion therapies as abusive and dangerous, believing instead what many transgender people have been convinced of: that when able to live out their daily lives with both a physical embodiment and a social expression that most closely matches their internal sense of self, transgender and transsexual individuals live successful, productive lives virtually indistinguishable from anyone else...
Medical body interventions and procedures are often necessary to enable living socially in a gender role that more closely matches one's gender identity, and many assume that being accurately perceived by others is a primary goal of body transformations. However, for those transgender individuals who experience the deep internal distress of body dysphoria, the effects wrought by physical changes - hormones, surgeries, or other procedures - go much deeper than surface appearances and are far from cosmetic.[citation needed] The primary effects of hormonal and/or surgical interventions are experienced directly by self, internally, increasing a sense of internal harmony and well-being at the deepest psychological and emotional levels, as well as through the physical senses especially proprioception - the body's own knowledge of itself. Many medical professionals have come to consider "post-transition" transsexuals (see “transgender transition”) to be fully cured of their dysphoria or any other disorder.
I don't have a solid opinion on the debate question, because I don't know exactly how tax write-offs work, or the politics surrounding that sort of thing. However, I do lean towards Julian's opinion.