Many potential adoptive parents find that adoption is an expensive journey and can put a strain on their finances. Fortunately, there are several options available to help finance your adoption.
Federal Tax Credit:
The IRS offers tax benefits for adoption that include a tax credit for qualified adoption expenses paid to adopt an eligible child and exclusion for employer-provided adoption assistance. According to the IRS website, the tax credit is non refundable for tax years after 2011 and for 2013, the tax credit has a limitation of $12,970 per child.
For the credit and the exclusion, qualified adoption expenses include necessary adoption fees, court costs, attorney fees, travelling expenses, and other expenses directly related to the legal adoption of a child under the age of 18.
For more information please visit this link to the IRS website http://www.irs.gov/taxtopics/tc607.html or consult with your accountant.
Federal law allows a reimbursement of $2,000 per child and not to exceed $5,000 in a calendar year for certain expenses associated with an adoption.
There are certain limitations and requirements to qualify for this reimbursement. You can find more information by visiting this link: http://www.dfas.mil/militarymembers/payentitlements/adoptionreimbursement.html
Employer Adoption Credit
To find out if your company offers some form of adoption benefits, ask your human resource or personnel department.
The Dave Thomas Foundation is also a great resource and encourages employer benefits for adoption. On their website you can find a list of employers that offer adoption benefits and a free toolkit and technical assistance for companies wishing to establish an adoption benefits policy.