The federal government has provided for a tax credit to assist adoptive parents with the expenses of an adoption. The credit phases out based on your modified adjusted gross income. The tax rules that govern how the credit is claimed and the amount of the credit are determined by the year your adoption was finalized. You will need to check with your own tax preparer to be certain that you qualify for and receive all of the benefits of this credit.
The list below shows the maximum adoption credit that can be claimed, per child, by year:
2017 – $13,570
2018 – $13,840
2019 – $14,080
2020 – $14,300
2021 – $14,440
2022 – $14,890
2023 – $15,950
If the child being adopted qualifies for the adoption subsidy program, the child is deemed “special needs” by the IRS and the full amount of the tax credit is available, regardless of whether or not any expenses were incurred in the adoption. Special needs children are usually those who come through the Department of Child Safety.