View Full Version : Talk to your accountants-10,000 tax credit per child

12-31-2003, 06:49 PM
Since we are all getting ready to talk to our accountants don't forget if you see adoption in your future to inquire about the tax credit. A TAX CREDIT IS BY FAR BETTER THAN A DEDUCTION!!!!! dON'T CONFUSE THE TWO!!!!!

It is my understanding...and do not quote me, you know me always covering my derrierre and reminding folks to check with a pro on this, but it is my understanding that you get 10,000 tax credit per child. Now there are restrictions but I think if you make less than $150,000 it is that amount.

So if after your deductions etc... you do not have 10,000 owed this can be carried I beleive 5 years!!!!

I would ask you accountant to help you figure out what you should withhold from your pay check towards taxes. Because knowing this you can playw ith your deductions so that you have the money now to spend on home studies etc... instead of getting a chunk back...

anyway since close to tax time it might be worth looking into.
With this scenerio if someone adopted two children from Ukraine and went independent with a facilitator and translator and even a courier and documents guy I think it is almost safe to say you would recuperate possible all of the money you spent...
AKA "mama2be"-forgot password
and Baby Boy Tristan born @UNC
Feb 25, 2003
Brother to 3 pups "gees" and 2 kitties

Kimberly H
12-31-2003, 10:09 PM
AND check to see if your state does anything for international adoptions. South Carolina offers a one-time $1,500.00 tax credit for international and domestic adoptees but your paperwork MUST be completed between referral and travel. Mine is at DSS as we speak :)

Edited: "paperwork" means calling for the application, filling out 8-10 blanks (name, address, child's name, etc) so they can send you the real document, then reading, signing the document and sending it back. VOILA! You just send in your receipts when you're done.

Great topic, Neve!

01-02-2004, 01:24 PM
Actually the tax credit is up to 10,160

If you are adopting internationally you can only take the credit after the adoption has been finalized. An adoption is considered final if your children travels home on an IR-3 Visa (both parents must travel and see the child before an adoption takes place in the birth country) or after your child has been adopted in the USA if they travel home on an IR-4 visa.

A child who is considered a domestic special needs adoption can qualify for the entire credit whether or not their parents spend the entire amount or not.

A domestic adoption is treated differently and you can start to take the credit the year after you start paying out money (so to take a credit for 2003 you would have had to spend money in 2002) if the adoption is not finalized yet or if the adoption is not completed at all

The IRS pub 968 explains the credit as it currently works. I think it's form 8839 (it's up to date for the current filing year).

Whatever you do don't adjust your withholdings unless you KNOW without a doubt that you will be able to take the credit that year because as much as it's nice to not pay the money in if for some reason (especially with an international adoption) you misjudge and your adoption is not final before the end of the year, you will end up owing money big time)