Adoption Tax Credit in Jeopardy of Extinction

The Federal Adoption Tax Credit (ATC), which helps defray the sometimes high administrative fees associated with adoptions, could soon expire if congress doesn’t vote to extend the credit by December 31.

Last week, Sens. Mary Landrieu (D-La.), Roy Blunt (R-Mo.), Kay Bailey Hutchison (R-Texas) and Ben Cardin (D-Md.) introduced the Making Adoption Affordable Act (S. 3616), a companion act to House Resolution 4373.

Both the House and the Senate bills push for an adoption tax credit that, thus encouraging more families to adopt children.

The Making Adoption Affordable Act will make the ATC now a permanent part of the tax code and make it refundable, which would allow adoptive families to receive a tax refund in excess of their tax liability.

“For families who have generously opened their hearts and homes to a child, the Adoption Tax Credit gives them important assistance along the journey. My husband and I are blessed with two precious, adopted children, and I am hopeful that this credit will encourage others to consider enlarging their families through adoption,” Sen. Landrieu said in a press release.  “I am committed to extending the Adoption Tax Credit and look forward to working with my colleagues on both sides of the aisle to support families who make the wonderful decision to adopt.”

Making the ATC refundable will be of particular benefit to families adopting children from foster care, because those families who adopt through foster care spend less than those who work with private agencies or attorneys, according to an official statement.

Also, families who adopt out of foster care statistically are of lower income than those adopting with an agency or internationally. A lower income means that the family is in a lower tax bracket, so the ATC is more likely to be in excess of a family’s tax liability.

Congress is expected to make a decision after the November 6 election day. Adoption advocacy groups are gearing up for the decision by encouraging people to reach out to their senators and ask them to vote in favor of the ATC.

The Adoption Tax Credit Work Group has sample outreach letters on their website to use to contact senators, along with questions about the ATC.

According to the work group’s website, “the adoption tax credit is likely to be included in a package of other tax credits” to be considered after the election.

Ryann Blackshere is a multimedia journalist with Fostering Media Connections.

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