NCFA Media : Archived News

National Council For Adoption Supports Tax Relief for Adoptive Families: Proposed Bill Would Make Expansion of Adoption Tax Credit Permanent

ALEXANDRIA, VIRGINIA, September 21, 2004 – The U.S. House of Representatives is scheduled to vote on Wednesday, September 22, on the Adoption Tax Relief Guarantee Act (H.R. 1057). By expanding the adoption tax credit and adoption assistance programs, the Economic Growth and Tax Reconciliation Act of 2001 made adoption more affordable and benefited many tens of thousands of children and families. However, the 2001 act contained a sunset provision that causes the expansion of the credits to expire on December 31, 2010. The Adoption Tax Relief Guarantee Act would repeal this sunset.

The 2001 act made adoption more affordable by increasing the available adoption tax credit and adoption assistance to $10,000 for all adoptions, from $6,000 for adoptions of children with special needs, and from $5,000 for all others. This is a significant benefit, but only partially covers the costs of a typical infant or international adoption, which ranges from $15,000 to $25,000, and higher. It also allowed parents adopting children with special needs to claim the benefits without having to meet the statutory definition of “qualified adoption expenses,” thus encouraging more adoptions of these children in need.

Concerning this commonsense legislation introduced by Representative Jim DeMint (R-SC), National Council For Adoption’s President and CEO Thomas Atwood said, “This very popular policy would help adoptive parents with the substantial costs of adoption and enable many more families to adopt. By repealing the sunset on the expanded adoption tax credit, Congress will make it possible for many more children to enjoy the benefits of growing up in loving, permanent families.”

According to Treasury Department analysis, as published in 2000 in the Report to the Congress on Tax Benefits for Adoption, “An analysis of tax returns for 1998 indicates that 44,700 taxpayers claimed the tax credit for adoption expenses and 3,900 taxpayers benefited from the tax exclusion. A total of $135.2 million in adoption expenses was claimed by the tax credit and exclusion.” This amounts to an average benefit of $2,782, an expense that far more than pays for itself, in terms of the vastly greater social and economic benefits that these children, their families, and all of society enjoy because of adoption.

Atwood continues, “By repealing the sunset on the expanded adoption tax credit and assistance programs, Congress will demonstrate bipartisan leadership on an important social issue and show an even greater commitment to the institution of adoption, making a positive impact among children and families across America.”
About NCFA

Since 1980, NCFA has been a leading voice among national adoption and child welfare organizations. NCFA is a research, education, and advocacy nonprofit that provides adoption information, promotes ethical adoption practices, informs public policy and opinion about adoption issues, and serves as a resource for women with unplanned pregnancies, adopted persons and their families, those seeking to adopt, and adoption professionals.

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