BulldogTom Posted August 30, 2012 Report Share Posted August 30, 2012 I think the deadline has passed for the special needs enhancement of the Adoption Credit, but I thought I would ask. Taxpayer's grandchild is a total loser. Gangbanger and sent to prison. Has a girlfriend who is just as bad. They made a baby. Then he thought they made another baby, but it turns out he was not at the conception like he thought he was. She is a druggie. When they both end up in jail, my client steps in to adopt what she thought was her 2 great-grandchildren. The state placed the children with her in Jan 2011. The adoption was final in May of 2012. Because of her income level, the state paid all the adoption costs. The state has declared the two children "special needs". If I am reading the requirements correctly, the adoption had to be final by 12/31/11 for the enhanced credit for adopting special needs children. Is this correct? I would like to get this lady a nice credit if the opportunity has not passed. PS, I understand because of all the fraud that these tax returns are taking forever to process. I get that. This is definately not a scam. Thanks, Tom Hollister, CA Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted August 30, 2012 Report Share Posted August 30, 2012 You are correct. Also, for 2012, the credit is no longer refundable!! Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted August 30, 2012 Author Report Share Posted August 30, 2012 I was hoping for some magic bullet like "if the adoption is substantially complete" or "if the child has lived with the parents for XX months". Too bad. Tom Hollister, CA Quote Link to comment Share on other sites More sharing options...
mcb39 Posted August 30, 2012 Report Share Posted August 30, 2012 "Taxpayers who adopt a child with special needs are allowed to claim the full amount of the credit regardless of actual expenses paid or incurred in the year the adoption becomes final (Code Sec. 36C(a)(3). Wouldn't it be nice if they extended this very worthy credit for special needs kids? I have a client who adopted three in 2005 and never had a problem with the credit which we carried forward to 2011 which was their fifth and final year. In 2011, they had an awful time getting their refund and exchanged paperwork for several months before they finally got their credit in Nov. Personally, I thought the "old" way of not refundable was a much better plan. It just wiped out their tax liability. However, I don't get to make the laws. 1 Quote Link to comment Share on other sites More sharing options...
jainen Posted August 31, 2012 Report Share Posted August 31, 2012 >>if the adoption is substantially complete<< Flash--Tax Court upholds the concept of "constructive adoption" in a brilliantly argued landmark case, Bulldog vs. Commissioner! Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted August 31, 2012 Author Report Share Posted August 31, 2012 >>if the adoption is substantially complete<< Flash--Tax Court upholds the concept of "constructive adoption" in a brilliantly argued landmark case, Bulldog vs. Commissioner! Good idea. I will claim the credit on behalf of the client and reference Jainen as the tax preparer relied upon for making the claim. Will you please sign the tax return? Tom Hollister, CA Quote Link to comment Share on other sites More sharing options...
jainen Posted August 31, 2012 Report Share Posted August 31, 2012 >>Will you please sign the tax return?<< No, you deserve all the fame. Notice that the landmark case is named after the preparer, not the taxpayer! Quote Link to comment Share on other sites More sharing options...
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