Adoption Expense Credit

[Ray in Ohio]

This is something new for me. I have a client who adopted two children in 07. From what I can find in the publications it seems to be fairly simple to claim this credit. I guess I am just asking if any of you have used this and what your experiences were. It looks like any child under 18 is a qualifying child and basically any expenses associated with the adoption process are qualifying expenses. Including travel, motels etc. If there is anything I am missing or just plain don't know about, I would love to hear from any of you.

That's what makes this forum so great!! Thanks in advance for any advice etc.

[MargaretMort]

It has been 10 years since my grandchildren were adopted but I believe what you said was correct. Her company paid her an amount to help with the costs which had to be deducted from the overall expense, of course. It seems to me that they were unable to take all the credit in one year, carried over until it was all used up. M

[jainen]

>>any expenses associated with the adoption process are qualifying expenses<<

That's true for a private adoption, but there's an even better deal for going through the county agency. Most or all of those children are designated "special needs," which means you get the maximum credit regardless of actual expenses.

[mcb39]

I have a couple who adopted 3 special needs children in 2005....credit was 31890....and can be carried forward for five years. They will never use it up as they, then, had their own first natural child the same year in December. They went from no children to 4 children under age 10 in one year. They both work hard, but because of the exemptions and the child care and child tax credits, they zero out every year so far. This is one of the most "interesting" and heart warming returns that I have ever had the pleasure of preparing; especially since when they first came to me with the return, they had no idea or knowledge about any adoption credits being available. They receive no EIC because of their jobs, but are using the adoption credits to build an addition on their house. This one kind of makes up for all of the filers who give me grief.