A federal appeals court says some bone marrow donors can be paid, overturning a decades-old law that made such compensation a crime.

In its ruling Thursday, the 9th U.S. Circuit Court of Appeals said a recent technological breakthrough in donating bone marrow is akin to blood-plasma donation. Therefore, the court ruled, it
should be exempt from a law making it a felony to sell human organs
for transplants.

The court did say it remains a felony to compensate donors for undergoing the older donation method, which extracts the marrow from the donors' bones.

The ruling overturns a lower court decision barring compensation for all bone marrow donations.

“Every year, nearly 3,000 Americans die because they cannot find a matching bone marrow donor, but the federal government has made it illegal to do the one thing that will make finding donors easier: paying them,” explained Jeff Rowes, the Institute for Justice's senior attorney and lead lawyer on the case. “Today’s decision will put a stop to this irrational prohibition, and it could save thousands of lives in the process.”

Recruiting bone marrow donors is particularly important because marrow donations, unlike blood donations, require an incredibly close genetic match, according to the Institute's press release. This makes it especially difficult for many racial minorities.

MoreMarrowDonors.org brought the case, seeking to offer donors $3,000 in the form of a scholarship, housing allowance or gift to charity.

But - there's a slight catch.

"This ruling could create a cottage industry, and Uncle Sam will surely want his share," said federal tax practitioner David Selig, who is based in New York City. "Yes, it's taxable!"

The Associated Press contributed to this article.