Adoption isn't cheap, whether one is spending a few thousand for home studies, a couple thousand in birth mother expenses or even more in travel fees to an adoptee's country of origin. Once all is said and done, the service fees and expenses can run upwards of $40,000. That's a tough total to budget, especially when an individual or couple is starting or expanding their family. Fortunately, adopters can claim their adoption expenses on their taxes and receive up to a third of their fees in their tax return. In 2010, the maximum amount refunded could reach up to $13,170.
Tax credits, unlike federal or states subsidies provided for public adoptions, can be awarded regardless of the child's special needs and health. Qualifying the adoption tax credit does, however, require the adopter have paid out of his or her own pocket for the adoption of a child under 18 years old. It cannot be applied to surrogate services or fees as well as stepparent adoptions. The credit also is inapplicable to expenses that have already been paid for or reimbursed by the federal or state government subsidies, as is common for public adoption home study fees. The credit also does not apply to any adoption fees paid before 1997.
To calculate and receive the credit, adopters much fill out IRS Form 8839. The Form 8839 will need to then be attached to Form 1040. The tax credit amount should be entered on Form 1040 on line 52 with "box b" marked off.
Claiming one's tax credit can be done any time after an adoption is finalized, although sometimes adopters may have to wait up to a year before filing for the adoption tax credit. This is more likely to be true for those who adopted internationally. International adoptions are eligible for a tax credit only after the adoptee is issued a visa. This can delay the adoption finalization if the child was adopted from a country, such as Korea, that does not finalize its adoptions in-country. Other delays may occur if a state requires a child whose adoption was finalized overseas be, essentially, "re-adopted" in the state courts.
Adoption Council of Canada Applauds Increase in Adoption Tax Credit
The Canadian government has taken another step in supporting adoptive families by increasing the federal adoption tax credit in the 2014 budget, says the Adoption Council of Canada.AdoptHelp.com Helps Families Receive the 2014 Federal Adoption Tax Credit
The founders of a leading adoption program are working with adoptive parents to help them receive the re-enacted federal adoption tax credit. (PRWeb February 17, 2014) Read the full story at http://www.prweb.com/releases/2014/02/prweb11586649.htm
Adoption subsidy issue is dead this year
An Indiana senator from South Bend who has tried for five years in a row to restore a state subsidy to help adoptive parents has failed again but says he's optimistic that next year -- a budget year fIRS Can Help With Adoption
Uncle Sam offers you a tax break to help defray costs of your new family member.
Assembly Of God
Employer Adoption Benefit Package
Legal Risk Adoption
Adoption Expense Tax Exclusion
Taxes and name change w/ SSN
January 15, 2014, 8:35 pm
We finalized our adoption back in June. Hubby was supposed to go to SS office and talk them into changing our son's SSN (technically according to their "rules" they're not supposed to, but our lawyer says most of the time in our area they will do it). Well, hubby is also world's worst...Anybody do their own taxes?
January 26, 2014, 2:59 pm
We finalized the adoption this last year on our two littles. They had name and socials changed. Last year we claimed them under their other numbers and names, this year it is different. I usually do our taxes myself and have no problems...this year I am nervous. 1. Will we be flagged because of...
January 15, 2014, 3:59 pm
[QUOTE=ImpactingLives]Even then I'm not sure. As I understand the adoption tax credit, it specifically reads that a child needs to be considered special needs "at the time of adoption." So even if you reapplied for the adoption subsidy I don't think it would entitle you to the adoption tax credit...It's that time of year again! What are you doing with your adoption tax credit?
January 30, 2014, 3:46 pm
We adopted in 2012 but still have a good portion left to carry over to this year. Our big plans are to get a fence! I can't wait for the kids to be able to play outside without worrying about them running off. Any big plans for your adoption tax credit (or if you get a big return generally;))
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