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FACTSHEETS FOR FAMILIES | JUNE 2020

Children’s Bureau/ACYF/ACF/HHS | 800.394.3366 | Email: info@childwelfare.gov | https://www.childwelfare.gov

Adoption Assistance for 

Children Adopted From 

Foster Care

WHAT'S INSIDE

Adoption assistance and eligibility

If you are considering adopting a child from 

foster care, there is a good chance the child 

may qualify for either Federal or State financial 

assistance. The child's specific circumstances 

will determine eligibility for adoption assistance 

and the type for which they may qualify. The 

goal of adoption assistance is to support 

adoptive families so they can adequately meet a 

child's needs.

Recent Federal data show an estimated 122,216 

children were awaiting adoption in fiscal year 

2019.1

 This factsheet will help you explore your 

eligibility for assistance.

1 Children's Bureau. (2020). The AFCARS report: Preliminary 

FY 2019 estimates as of June 23, 2020 (27). U.S. Department of 

Health and Human Services, Administration for Children and 

Families. 

Securing adoption assistance

Resources
Children’s Bureau/ACYF/ACF/HHS | 800.394.3366 | Email: info@childwelfare.gov | https://www.childwelfare.gov 2

ADOPTION ASSISTANCE AND 

ELIGIBILITY

The Federal Adoption Assistance and Child 

Welfare Act of 1980 established a program 

of financial and medical assistance to 

help promote adoptions from foster care, 

reduce financial barriers to adoption, and 

help adoptive families meet their adopted 

children's needs. This adoption assistance 

is also called a subsidy and is available 

for children who meet certain eligibility 

requirements, including that the child is 

deemed as having special needs due to 

their physical, mental, or developmental 

disabilities or because there are other 

factors that may make it harder to find an 

adoptive family. Some children in foster care 

may have conditions that are the result of 

their early infant or childhood experiences. 

This may include physical or mental health 

disorders, learning difficulties, or related 

developmental delays that require ongoing 

treatment or specialized medical, therapeutic, 

or educational attention. Special needs don’t 

necessarily have to be medical or physical. 

Many States provide adoption assistance to 

children of color, children who are older, or 

those who are being adopted with brothers 

and sisters. Each State can determine what 

factors or conditions a child must have in 

order to be considered to have special needs 

for purposes of establishing eligibility for 

adoption assistance.2

2 Children's Bureau. (2019). I want to adopt a child from foster care. Am I eligible for adoption assistance (also called adoption 

subsidy)? U.S. Department of Health and Human Services, Administration for Children and Families. 3 Children's Bureau. (2018). Child Welfare Policy Manual, 8.2A, Title IV-E Adoption Assistance Program, Agreements. 

A child who is eligible for Federal adoption 

assistance is entitled to receive both an 

adoption assistance subsidy and medical 

assistance (such as Medicaid) if the child is 

adopted by a family that the State deems 

appropriate for that child. If the child is 

eligible, you are entitled to receive ongoing 

monthly payments while the child is in your 

care and you are responsible for the child. 

The assistance may last until the child reaches 

the age of majority, which in most States is 

age 18—although some States provide Federal 

adoption assistance up to age 21. Adoption 

assistance may also include a one-time 

payment to help you cover at least a portion 

of your adoption expenses. Depending on the 

State and the child’s circumstances, assistance 

may include other support services, such as 

child or respite care, or services that address 

the child’s specific developmental needs. 

These services must be listed and included in 

the adoption assistance agreement to ensure 

that they are provided to the child.3
Children’s Bureau/ACYF/ACF/HHS | 800.394.3366 | Email: info@childwelfare.gov | https://www.childwelfare.gov 3

TYPES OF ADOPTION ASSISTANCE

Children may qualify for Federal or State 

adoption assistance. Some States provide 

adoption assistance for children who do not 

qualify for Federal assistance. In most cases, 

the benefits are the same whether the subsidy 

is Federal or State, but there are occasionally 

some differences related to receiving 

Medicaid. For example, some States do not 

provide Medicaid for children who are only 

eligible for State-funded adoption assistance 

unless there is a disability that warrants; 

however, all children who are eligible for 

Federal adoption assistance are categorically 

eligible for Title XIX Medicaid or an equivalent 

type of health coverage . 

4 Title IV-E Adoption Assistance 'Applicable Child' Eligibility Criteria; section 473 of the Social Security Act; Child Welfare 

Policy Manual, §8.2B.

Among other critical eligibility criteria, 

in order to qualify for a Federal adoption 

subsidy, the child you are adopting must be 

eligible for adoption assistance under title 

IV-E of the Social Security Act by meeting the 

following criteria for having special needs:4

 The State has determined the child cannot 

or should not be returned to the parents' 

home.

 The State has identified a specific factor or 

condition, or a combination of factors, that 

make it reasonable to conclude that the 

child cannot be placed with the adoptive 

parents without adoption assistance and 

Medicaid; or the child meets the medical 

or disability eligibility criteria for Federal 

Supplemental Security Income (SSI). 

 The State has made a reasonable but 

unsuccessful effort to place the child 

without Federal adoption assistance and 

Medicaid (unless this is against the child’s 

best interests). If an adoptive parent 

informs the State that they are not able 

to adopt the child without assistance, this 

prong of the special needs test will be met 

as to the child's eligibility. 

For more information on how you may qualify 

for Federal title IV-E assistance, see the Child 

Welfare Policy Manual's Section 8.2B, Title 

IV-E, Adoption Assistance Program Eligibility

and the Children's Bureau Information 

Memorandum on Title IV-E Adoption 

Assistance 'Applicable Child Eligibility Criteria. 

If your child does not qualify for Federal 

assistance, they might be eligible for Statefunded adoption assistance. Child Welfare 

Adoption Tax Credits

In addition to the Federal and State 

adoption assistance programs, families 

who adopt children from foster care 

are eligible for a tax credit. Tax benefits 

include a tax credit for qualified adoption 

expenses and an exclusion from income 

for employer-provided adoption 

assistance. The tax credit is based on a 

family’s income and tax situation. While 

the tax credit is limited to the year in 

which the adoption is finalized, credit 

exceeding a family’s tax liability can be 

carried forward for up to 5 years. 

For more information, see the IRS page on 

Adoption Credit and Adoption Assistance 

Programs. 
Children’s Bureau/ACYF/ACF/HHS | 800.394.3366 | Email: info@childwelfare.gov | https://www.childwelfare.gov 4

Information Gateway maintains a State-byState adoption assistance database that seeks 

to answer questions about State policies 

on adoption assistance and postadoption 

services, including the following:

 What is your State's definition of "special 

needs?"

 What are the eligibility criteria for your 

State-funded adoption assistance program?

 What is the maximum amount a family can 

receive in one-time, nonrecurring adoption 

expenses from your State? 

 When can the adoption assistance 

payments and benefits begin in your State?

 Does your State enter into deferred 

adoption assistance agreements?

 What mental health services are provided 

by your State?

 Does your State provide additional finances 

for medical or therapeutic needs not 

covered under the State medical plan for 

children receiving adoption assistance?

 What is your State's process for applying for 

a fair hearing? 

The Children's Bureau offers a webpage 

on adoption assistance. Child Welfare 

Information Gateway also hosts a webpage on 

adoption assistance that may be helpful as you 

explore eligibility for assistance. 

SECURING ADOPTION 

ASSISTANCE

When a child is in the placement and care 

responsibility (custody) of a State foster 

care agency, that State is responsible for 

determining and entering into the adoption 

assistance agreement with prospective 

parents regardless of where they live. If the 

adoption is approved, the agency will draw 

up an adoption assistance agreement for the 

prospective adoptive parents to sign. As the 

prospective parent, you can negotiate the 

terms of the financial assistance, which must 

not exceed the amount that the child would 

have received while in foster care. You also 

should discuss and negotiate services that 

you believe the child needs or will need in 

the future. Each State has its own procedure 

for initiating and completing the adoption 

assistance agreement, including how the 

monthly payment amount is negotiated.

The adoption assistance agreement must be 

finalized, signed, and in effect at the time 

of, or prior to, finalizing an adoption. With 

rare exceptions, it is highly unusual to obtain 

an adoption subsidy after an adoption has 

been finalized if the adoption assistance 

agreement was not in effect at the time that 

the adoption was finalized. Federal law allows 

for the terms of the assistance agreement 

to be renegotiated if the circumstances 

of the adoptive family and needs of the 

A fair hearing is a legal, administrative 

procedure that provides a forum for 

settling certain types of disputes between 

applicants for Federal adoption assistance 

or recipients and the public agency that 

administers the program. If you think a 

decision is unfair, you may be able to 

request a fair hearing to resolve the dispute. 

See Information Gateway’s database for 

State-specific policies on fair hearings.
Children’s Bureau/ACYF/ACF/HHS | 800.394.3366 | Email: info@childwelfare.gov | https://www.childwelfare.gov 5

child change over time. In the event that a 

medical, developmental, or mental health 

need surfaces after an adoption is finalized, 

adoptive parents can seek to renegotiate the 

terms of the adoption assistance agreement 

with the State to address the child's needs. 

For the most part, once the agreement is 

finalized, the agency cannot change the 

agreement unless the parents concur with 

such a change. Consult Information Gateway's 

adoption assistance database for more 

information.

DEFERRED ASSISTANCE

Depending on the State placing the child, the 

State may want to negotiate with the parents 

to defer adoption assistance/financial 

support until it is needed to meet a child's 

needs or until the child’s disabilities are 

diagnosed. This is most often used when 

families are adopting a young child with 

potentially high risks for developing a medical 

or psychological condition. In these cases, the 

State may provide Medicaid and 

reimbursement of nonrecurring adoption 

expenses, without providing a monthly 

payment. Your adoption assistance agreement 

may specify the events or conditions that 

would initiate the need for services or activate 

the monthly payment option. An adoptive 

parent also may decline a financial subsidy 

that the State offers. Psychiatric reports and 

other documentation are often required to 

justify the need for a subsidy. In some States, 

parents can choose to defer financial 

assistance until needed for specific services. 

For State-specific information, see Does Your 

State Enter Into Deferred Adoption Assistance 

Agreements? on Information Gateway's 

State-specific adoption assistance database.

When Adopting a Child From Outof-State or Moving to Another 

State

If you are adopting a child from 

another State, and the State agency 

has responsibility for placement and 

care (custody) of a child, that State is 

responsible for entering into the adoption 

assistance agreement and paying the title 

IV-E adoption subsidy. This applies even 

if the child is placed in an adoptive home 

in another State. If, however, the State 

agency does not have responsibility for 

the child’s placement and care (custody), 

the adoptive parents’ State of residence is 

responsible for determining whether the 

child is eligible for adoption assistance; 

entering into the adoption assistance 

agreement; and paying the subsidy, 

consistent with the way public benefits are 

paid in other programs. Children retain 

their eligibility for adoption assistance and 

Medicaid across State lines; however, the 

details of the child’s Medicaid service are 

likely to change if your family relocates to 

another State after adopting. For more 

information, see Information Gateway’s 

webpages on Adopting Children 

From Other States or Jurisdictions and 

Interjurisdictional Placements. 
Children’s Bureau/ACYF/ACF/HHS | 800.394.3366 | Email: info@childwelfare.gov | https://www.childwelfare.gov 6

APPEALING AN ADOPTION ASSISTANCE 

DECISION

In general, you can use your State's fair 

hearing and appeals process if you do 

not agree with the decision on adoption 

assistance. The agency that enters into the 

adoption assistance agreement is required to 

inform you about the appeals process. Some 

families choose to work with an attorney 

or seek help from an advocacy organization 

representing children with special needs 

during this process. For more information 

on the fair hearings process, see What Is 

Your State's Process for Applying for a Fair 

Hearing? on Information Gateway's Statespecific adoption assistance database.

RESOURCES

Below are some additional resources for 

prospective adoptive parents:

 Adoption-Friendly Workplace, a webpage of 

the Dave Thomas Foundation for Adoption, 

which lists the top 100 companies for 

employer-provided adoption benefits and 

compares financial reimbursement and paid 

leave policies

 Benefits.gov, the official benefits website of 

the United States Government

 Child Welfare Policy Manual: Title IV-E

 Adoption Assistance & Financial Support, 

a webpage on Raise the Future (formerly 

the Adoption Exchange), a nonprofit child 

welfare organization created to promote 

safety and permanence for children in 

foster care

 National Foster Care and Adoption 

Assistance Directory, an Information 

Gateway database

 State Adoption Assistance Specialists, an 

Information Gateway webpage 

 Title IV-E Adoption Assistance, a Children's 

Bureau webpage

SUGGESTED CITATION: 

Child Welfare Information Gateway. (2020). 

Adoption assistance for children adopted from 

foster care. Washington, DC: U.S. Department 

of Health and Human Services, Administration 

for Children and Families, Children’s Bureau.

This material may be freely reproduced and distributed. However, when doing so, please credit Child Welfare Information 

Gateway. This publication is available online at https://www.childwelfare.gov/pubs/f-subsid/.

U.S. Department of Health and Human 

Services Administration for Children and 

Families Administration on Children, 

Youth and Families Children’s Bureau