Written by: Anna Hull, Family Support Services Supervisor
With the New Year comes W-2s and the approaching tax season. For families who were able to finalize their adoption in 2019, either internationally or in their home state, they will be able to take advantage of the Federal Adoption Tax credit. While this is not a refund, this is a credit that can be applied to your federal income tax liability that can help offset some of your adoption expenses.
For 2019, families meeting certain income requirements can claim up to $14,800 tax credit per child based on their qualified adoption expenses. If you fully finalized your adoption in 2019, refer to the North American Council on Adoptable Children’s article to familiarize yourself with the adoption tax credit and then make sure to talk to your tax preparer to see what you are eligible to claim this year. As a note, while most international adoptions today are considered “special needs,” this status does not meet the IRS requirement for special needs, which applies to adoptions through foster care and not private adoptions.
For those still in the adoption process or recently home, the New Year is also a good time to look at the resources around you to see if there are other resources available to help fund your adoption. Some states have their own adoption tax credits in additional to the federal tax credit that families residing there may be eligible for. Some employers and religious organizations provide financial support in the form of credits and matching programs that can help families fund their adoptions. To learn more about the other options that may be available to you, talk to your local tax preparer or HR representative at work and go to our “Paying for Adoption” page for other ideas and opportunities.