Resources to Help Defray Adoption Costs

Federal Tax Credit: The federal government has a tax credit for most adoptions. See the IRS publications below (PDF) for information about tax rules and changes to those rules. The tax credit is over $10,000, and is available in the tax year the adoption is finalized.

IRS Publication #968: Tax Benefits for Adoption 2005 form
IRS Publication #8839: Qualified Adoption Expenses 2005 form
     Publication #8839 Instructions

Employer Benefits: Many employers provide a range of benefits for families who adopt, including paid or unpaid leave when a child arrives in the home, reimbursement of some portion of adoption expenses, assistance with adoption information and referral services, etc. Your human resource department may  provide employees with information about benefits available.

Subsidies. Federal and State adoption subsidies (or adoption assistance) may be available to help adoptive parents pay for the ongoing care of children with special physical, mental, or emotional needs. In addition, some children qualify for Supplemental Security Income (SSI) or Medicaid coverage. The NAIC factsheet Subsidized Adoption: A Source of Help for Children with Special Needs and Their Families provides more information on this topic.

Adoption Loans and Grants. Adoptive parents may be eligible to receive a loan or grant to offset some of their adoption costs. Such programs may have specific requirements regarding the type of adoption that is eligible, or they may give preference to families with the greatest financial need or with other specific characteristics.

Note: Sunny Ridge adoptive families should contact the IRS or a tax advisor for information on the tax credit or exclusion.