317-426-9334             445 N. Pennsylvania St., Indianapolis, IN   46204

Adoption Tax Credit - 2018

 

Adoption Tax Credit Advice for Married and Unmarried Couples

 

Many potential adoptive parents find that adopting a child puts a big strain on family  finances.  While  same-sex  couples  are  excluded  from  many  tax benefits, there is one instance that they qualify for tax breaks while opposite-sex married couples don’t – if they adopt a partner’s child.

 

The  Federal  Adoption  Tax  Credit  became  permanent  in  2013  and  it  has survived the 2017 tax cuts, allowing for a maximum adoption tax credit of$13,840 for 2018. The tax credit is non-refundable, meaning that only those who owe taxes are allowed to claim it. It is based on modified adjusted gross income, and is recalculated each year.

 

Who Qualifies?

Both  same  sex  and  opposite  sex  couples  who  are  married  can  claim  the federal  tax  credit  when  they  adopt  a  child  together,  but  they don’t qualify when one spouse adopts the child of his or her spouse. However, same-sex couples  in  Indiana  who  are  not  married  can  qualify  for  the  Adoption  Tax Credit  for  the  expenses  of  their  second  parent  adoption  of  their  partner’s child.

 

A second-parent adoption allows an unmarried same-sex partner to adopt his or  her  partner’s  biological  or  adopted  child  without  terminating  the  first parent’s legal status, and the Federal Adoption Tax Credit grants qualifying taxpayers up to $13,840 per child for certain expenses, which include legal fees, court costs, and the charges associated with a home study.

 

What Expenses Qualify?

Qualifying  adoption  expenses  include  reasonable  and  customary  adoption fees accrued in a domestic, international, or foster care adoption. Surrogacy or  stepparent  adoptions  (i.e.,  adoption  of  a  legal  spouse’s  child)  do  not qualify for the credit. If you live in a state that offers an adoption tax credit,you may receive credit for additional expenses as well; however, Indiana is one of seven states that offer no state income tax relief for adoption. If you have questions regarding adoption tax credits and whether or not you qualify, Indiana Adoption Tax Credit Attorney Barbara J. Baird can offer guidance.

 

Considering adopting a baby or young child and need tax advice? Contact the
Law Office of Barbara J. Baird, an Indianapolis attorney who specializes in helping  the  gay  and  lesbian  communities  of  central  Indiana  with  their adoption and family law issues.

 

Call 317-426-9334 for a case evaluation at her Indianapolis office.

 

 

 

 

 

© Copyright 2018 Barbara J. Baird   •  Advertising Material

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Barbara J. Baird Attorney at Law

445 N. Pennsylvania St

Indianapolis, IN   46204

317-426-9334

© Copyright 2018 Barbara J. Baird  |  advertising material

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