The Federal Adoption Tax Credit; General and Specific Issues

The following is a general overview of the Federal Adoption Tax Credit and attempts to address certain questions that adoptive parents may have.  The ultimate issue with the Tax Credit now is that it is scheduled to sunset at the end of 2012, and most of its significant portions will not apply in 2013.

WHAT IS A TAX CREDIT?  Generally, a tax credit is used to reduce the amount an individual owes in taxes to the federal government.  For example, let’s say that one owes the government $100 in taxes after calculating income, but there is a $10 tax credit available for which one qualifies.  This reduces final tax liability to $90. At the most basic level, this is how the Adoption Tax Credit operates in 2012.  The IRS website provides examples of the applicability of the credit.

WHAT IS THE PURPOSE OF THE TAX CREDIT? It is intended to reimburse individuals and families for certain qualified expenses incurred during the adoption process.  It is also intended as a mechanism to encourage adoption as a method of family growth.

HOW DOES THE TAX CREDIT WORK? This is a one-time credit for each adopted child.  If a child was adopted in 2009, one could claim the credit in 2009.  If the credit was claimed in 2009, it cannot be claimed again the following taxable year.  If one adopted two children in 2009, one could claim the credit twice for that year.  In the years 2010-11, the credit is refundable, meaning that one would actually get a check in the mail if the adoption was finalized in those years, offset by any income tax owed. … <Read More>


Gay Adoptions in U.S. Triple, but Inequality Still Exists

Recent studies show that gay and lesbian couples are adopting more than ever. According to UCLA School of Law’s Williams Institute, the number of children granted to gay and lesbian couples nearly tripled over the last decade. This is definitely positive news for the gay rights movement as well as beneficial to children placed in foster care and adoption agencies.… <Read More>


Not So Equal…

 

This summer we witnessed history in the making as on June 24, 2011 the New York State Legislature passed the Marriage Equality Act, legalizing same-sex marriage in the state of NY. The new law provides same-sex married couples with the same benefits as opposite-sex couples, such as eligibility for health insurance coverage, hospital visitations, inheritance laws, children having two legal parents, and etc.   Without a doubt, for the New York LGBT community, the new law is one more victory in a fight for equality.  However, since the laws nationwide provide a very disparate treatment when it comes to things such as, for instance, adoption, the fight for equality is far from over.… <Read More>


Will the U.S. Supreme Court History Repeat Itself Again?

A look back into the history of this country illustrates that the fight over whether same-sex marriage should be allowed is yet another hotly debated issue that has divided this country and challenged our long-standing notions of morality and tradition.  Less than a century ago the thought of women having a right to vote was deemed unconscionable.  Today women cannot even fathom the fact that they could have ever been denied such a fundamental right as citizens.   About fifty years ago African-Americans fought to have the same rights as white Americans to vote, to frequent public establishments, and to utilize public transportation; whether black children should be allowed to attend the same schools as white children was hotly disputed; blacks were denied admittance into graduate schools, and interracial marriages were prohibited.   Today our country is being led by a black (or to be more accurate – interracial) president who attended an Ivy League law school.  The contested list of constitutional rights is long.   And if an old adage that “history tends to repeat itself” is true, then it is just a matter of time before the right to a same-sex marriage becomes the supreme law of the land, and protests and debates are featured on the History channel.  Until then, we just have to wait and watch as this fight plays out in the courts, in the Congress, in the upcoming presidential elections, and in our streets.… <Read More>