Federal Adoption Tax Credit – Get Reimbursed For Adoption Expenses
Posted Apr 16 2013 10:08pm
For some families, children arrive biologically and for others they arrive through adoption. Either way the joy of holding a child is equally thrilling and overwhelmingly full of love from the many people I’ve known who have one, or both, kinds of children in their families. One of the issues with adoption that sometimes puts people off of the idea is the expense. But here is some good news, The federal adoption tax credit has been made permanent. For 2012 the tax credit is $12,650. That’s doesn’t mean that money is tax deductible, it means it is a credit. As in, that money will be taken off any taxes owed the government, so basically you are getting that money back (provided you owe taxes at tax time). For 2013 the tax credit will is raised to $12.970.00 and should increase each year slightly. It is best to consult with a tax professional to be sure that anyone adopting can take full advantage of the credit. But some basic information is that for 2012 that $12,650 is available if your modified adjusted gross income is equal to or less than $189,710. If your income is above that but less than $229,710 you will receive a reduced tax credit. You are not eligible for the credit if you earn more than $229,710. For 2013 the full credit is available if your MAGI is equal to or less than $194,580. And you qualify for a reduced amount if you earn up to $234,580. Above that you are not eligible. This credit is available to reimburse any reasonable adoption expenses, but most adoption expenses seem to be covered – such as attorney fees, agency fees, travel expenses including food and lodging while traveling. For more information, there is a wonderful article in this month’s issue of RESOLVE – the newsletter put out by the National Infertility Association. You can also find more information at www.adoptiontaxcredit.org. Here’s to making it a tiny bit easier and more realistic for many people to share their love with children already waiting for a home and family!