Tax Refund... Where to find???

[Marcimama]

Hi all,
My dh is really interested in finding out some more "concrete" information on the new adoption tax refund. He just needs to "see it to believe it". Where, oh where can I find some specific and clear information on it?

I've googled it, but just keep coming up with the re-embursment info...


Thanks!

[Polliwog]

It's in the Health Care bill. The section about adoption starts on page 903 (Sec 10909.)
http://usgovinfo.about.com/library/PDF/hr3590.pdf

[marsupial-mom]

http://taxes.about.com/od/deductions...tioncredit.htm

things to keep in mind:
most international adoptions will cost more than the tax credit
the credit phases out after a certain income level
if you adopt through the fostercare system your costs will be so low that the tax credit won't mean much... Unless you adopt a child with special needs

in my opinion, the new tax credit is mostly to help:
middle class families who want to adopt but worry that it's too expensive
special needs kids who don't have permanent homes

[queenjane]

Originally Posted by marsupial-mom

http://taxes.about.com/od/deductions...tioncredit.htm


if you adopt through the fostercare system your costs will be so low that the tax credit won't mean much... Unless you adopt a child with special needs

in my opinion, the new tax credit is mostly to help:
middle class families who want to adopt but worry that it's too expensive
special needs kids who don't have permanent homes

As long as the child you adopt from foster care receives a monthly subsidy, they will qualify as "special needs" for tax purposes (i'm adopting a sib group, the older girl qualifies for subsidy based on age, the boy qualifies based on needing to be placed w/ his sister even though otherwise he would not get a subsidy), and with this new change to the tax credit, it doesnt matter how little you pay for a state adoption, you will get the ENTIRE $13K+ amount refunded to you at tax time.

Which is totally awesome because i'm (hopefully) finalizing on two kids this year, and that kind of money will be life-changing for us.

[Polliwog]

That's a good link, Katharine. It explains all of the changes really well. Nothing surprising but it will be a good link to pass along to others who have questions.

Polliwog's adoption will qualify as special needs. So, I'm actually looking forward to tax time next year. A friend is adopting three special needs children in a few weeks.

[christophersmom]

Even in writing, my DH still doesn't beleive it. I guess we will see, DD is classified as special needs and her adoption will likely be finalized in Sept. 2010.

[Marcimama]

The tax credit is a HUGE benefit to us. Prior to it becoming refundable it would have never helped us because we are always returned a bunch of money because we work at a camp and raise a sizable portion of our salary.

On paper we look like we make NOTHING, but in reality we are very very well cared for. We've known our financial situation may make us "look" ineligible to adopt, but I've talked with several agencies that say we look fine for most countries...

Thanks, that was helpful!

[marsupial-mom]

Sorry, I didn't mean for my post to come off as negative. I didn't mean that at all. The credit is great and will help out a lot of people, maybe even us. I think our income might be too high to qualify but our child is technically special needs simply because he's black - sad but true.

[Polliwog]

I wish I had the problem of my income being too high for the ATC.

[Marcimama]

Also, I know that this is only available if you finalize in 2010... right.

What if you finalize after that... Just have faith that there will be a similar tax credit?

[queencarr]

So has it been decided if the carry forward will be refundable yet? I read so many conflicting stories, and the way the law is written into the Health Care bill, it could be interpreted either way.

[Polliwog]

Originally Posted by Marcimama

Also, I know that this is only available if you finalize in 2010... right.

What if you finalize after that... Just have faith that there will be a similar tax credit?

It's for adoptions that finalize in 2010 and 2011. It's scheduled to sunset in 2012 and go back to about $6,000 but I suspect that it won't go back that low.

Originally Posted by queencarr

So has it been decided if the carry forward will be refundable yet? I read so many conflicting stories, and the way the law is written into the Health Care bill, it could be interpreted either way.

According to the link that Katharine posted, it's only for new adoptions. I wish that wasn't true, though. I haven't touched a penny of my son's ATC.

[queencarr]

That was the way I read the link, too. I just haven't seen anything definitive from IRS, so am still somewhat hopeful. Shh, but Rick is open to another adoption in a few years if the budget can handle it and we are both employed and making enough money. The two credits we have wasting away would make a HUGE difference for us