The IRS announced the amount of the 2017 Adoption Tax Credit.
2017 Adoption Tax Credit-Non Special Needs Adoptions
The amount allowed in 2017 for the Adoption Tax Credit for non special-needs adoptions, both domestic and international, is $13,570 for “qualified adoption expenses”. The definition of what IRS considers a qualified adoption expense has not changed, and families must be able to document these expenses, if requested by the IRS. This amount is up slightly from 2016 ($13,460).
The 2017 Adoption Tax Credit begins to phase out for taxpayers with modified adjusted gross income (MAGI) more than $203,540 and completely phased out for taxpayers with MAGI of $243,540 or more.
2017 Adoption Tax Credit-Special Needs Adoptions
Families who adopt a child with special needs from US foster care are eligible to claim the Federal Adoption Tax Credit in 2017 of $13,570 whether or not they actually incurred any adoption expenses. A child is considered to have “special needs” if they receive an adoption assistance/subsidy benefits from the state.
Children adopted internationally, even if they have diagnosed special needs, are not considered as a “special needs adoption” by the IRS and parents can only claim the credit for qualified adoption expenses.
Will the Adoption Tax Credit be Refundable in 2017?
The Adoption Tax Credit for taxes filed in 2017 is not refundable. A refundable tax credit is one you get back regardless of what you owe or paid in taxes for the year. When the credit is not refundable, you receive only what you have in federal income tax liability.
The Adoption Tax Credit was only refundable for 2010 and 2011, but we have been working ever since to make it refundable again, and we can use your help! The Adoption Tax Credit Working Group has been working to protect the adoption tax credit and make it refundable. Creating a Family is a member of this group, and we report on their progress and when they need our help. You can find these updates on our Adoption in the News page.
Creating a Family Radio Show on 2017 Adoption Tax Credit
Our annual Adoption Tax Credit show has not been booked yet, but will likely happen in January 2017. As always, we will have two of the top experts on this credit to answer all your Adoption Tax Credit questions. To find out exactly when this show will air and to submit questions in advance, sign up for our weekly adoption newsletter.
Other Creating a Family resources you will enjoy:
- Does the Adoption Tax Credit Hurt Kids?
- Adoption Tax Credit Equals Welfare?!?
- Using the Adoption Tax Credit with the Kids Stuck in Congo
Image credit: Nick Lee (This guy does some of the greatest paintings. Check him out!)
I adopted my two grandchildren because of issues with their parents. One has a disability and is considered special needs, but I did not adopt from fostercare and they never received a stipend. Can I still get the adoption credit?
Hi Donita!
Thanks for checking out our site in your search for information. In addition to listening to our annual show that deals with the specifics of this year’s tax credit information, http://ow.ly/3Eii30g2eTn I think you also might find some helpful information on our Adoption Tax Credit Resource Page – http://ow.ly/AcO330g2eQZ For the particulars of your two children’s cases and your own tax liablity, you also need to find a tax professional that is well-versed in the specifics of the tax credit as it applies to your situation. If you have general questions about the Adoption Tax Credit, we encourage you to submit them to info@creatingafamily.org and we can consider them for our upcoming annual show that we do in January.
If you are looking for specific information about adoption subsidies (which are different than the adoption tax credit), we always refer people to the North American Council on Adoptable Children (NACAC) site where they have people who can answer questions – https://www.nacac.org/help/adoption-assistance/
Good luck to you!
Will you have adopted 5 children since 2015 we have never received a text credit because it’s always been non refundable what happens to the $13400 over the years we ever be eligible to received that money
If you haven’t worked with a tax professional who understands the Adoption Tax Credit, we highly encourage you to listen to this show and share it with your tax preparer. It will explain the difference between the (former) refundable benefit and the (current) credit system. Here’s a link to the show: https://creatingafamily.mystagingwebsite.com/adoption-category/adoption-tax-credit-2017/
I’m adopting two little girls through Foster care will I get adoption credit when when I file my 2017,returns.
We have a whole resource page dedicated to helping you figure out the Adoption Tax Credit. I’d recommend you start with the annual radio show. Our Adoption Tax Credit Headquarters can be found here: https://creatingafamily.mystagingwebsite.com/adoption/resources/adoption-tax-credit/.
I am unclear as to how a tax credit and an employer benefit that provides up to $5,000, work together. Can you get both the $5,000 and apply for the $13,570 in tax credit?
Maureen, I believe we addressed this on either the Adoption Tax Credit 2017 Creating a Family Radio show or the Adoption Tax Credit 2016 show. You can search for these shows on this site and listen to them.
So will the adoption credit be non refundale or refundable in 2017.
Nonrefundable.
My husbands kids biological mother is in prison. So I adopted them. Do I qualify for this credit. I am now their primary care giver.
Aimee, I recommend that you either listen to this year’s annual Creating a Family Adoption Tax Credit show or read these 8 Facts You Must Know about the Adoption Tax Credit. I’m not a tax expert, but it is my understanding that the Adoption Tax Credit is not available for step parent adoptions.
I adopted a child this year. Will I not be eligible to receive the $13,000 for the tax credit when I file my taxes in 2017?
Stay tuned for the Creating a Family Radio show on the Adoption Tax Credit 2017. If you need info on the date, sign up for our weekly adoption e-newletter. https://creatingafamily.mystagingwebsite.com/subscribe
How many years can the Adoption Tax Credit be used. In the past it has only been good for 5 years. Is this one the same. I heard from an adoption attorney that it changed but couldn’t find any supporting documentation. I am NOT asking about the permanency of the bill itself. I know that was made permanent a few years back. I am talking about actually using the credit for “x” amount of years. Thanks so much.
We will ask this question on the annual Creating a Family Adoption Tax Credit show, which usually is scheduled in Jan. To get more info on this show and to submit more questions for our panel of experts, sign up for our weekly adoption e-newsletter at https://creatingafamily.mystagingwebsite.com/subscribe.