Federal tax bill almost included elimination of adoption tax credit

JAY — The foster and adopted children support nonprofit My Father’s Arrows, along with thousands of adoptive families, learned Nov. 10 the federal adoption tax credit will remain in place. Republicans of the House of Representatives mulled removing the credit from its tax plan it would send to President Donald Trump but supporters of the credit convinced them to let it stand.

The credit is not a refund. However, adoptive families may claim a credit of up to $13,750 in qualified adoption expenses. Families who adopt a child from foster care with state-determined special needs may claim the full amount regardless of qualified expenses, according to adoptiontaxcredit.org.

As of Sept. 30, 2015, there were 427,910 children in foster care — an increase of 30,305 since 2011, according to the U.S. Department of Health and Human Services.

"With so many children waiting in foster care, we don’t want to do anything to make it financially more difficult," My Father’s Arrows founder Sarah Ellis said. "It’s an undue burden on adoptive parents. Kids that are harder to get adopted are large sibling groups, so there is more financial planning needed for that. This is a big deal for adoptive families."

Adopting from foster care can cost little to nothing but the credit can still help, Ellis said. Private agency adoption can cost between $5,000 and $40,000, according to HHS.

"I think people go the private route when they want a completely closed adoption. Often times, they also want an infant adoption. Most of the time, adoptions available through state are older kids and sibling groups. You rarely see infants for adoption through state out of foster care. Often times, they’re adopted by relatives or the foster family."

Before the news came that the credit would remain, Ellis said adoptive families were mostly concerned for children left without a family.

"Think in general the concern was more kids would be left un-adopted because people would be concerned they would not have the financial means to prepare long term," Ellis said. "It really directly impacts the number of kids that could be adopted."

Many adoption proponents want the credit to be a refund as it was in 2010 and 2011.

"(That) was a huge help for adoptive families, something lots of adoption families pushed for," Ellis said. "It sort of mobilizes that money instead of a credit."

Texas Representative Kevin Brady, Republican, heads the House Ways and Means Committee. The group introduced the Tax Cuts & Jobs Act, the bill which could have included the end of the adoption tax credit. Brady, a father of two adopted boys, defended the move.

The idea behind eliminating the adoption tax credit was to instead raise the child tax credit, Brady said during a Nov. 7 Ways and Means Committee hearing.

"We had proposed really to…drive up the child tax credit in amount," Brady said. "For the first time give help to the parents (and) double the amount of people that could use it. So instead of an adoption credit for some once in their lifetime, we give help to families who don’t itemize every year of their lifetime for those kids."

"I know everybody wants to be fiscally responsible but we need to keep kids first," Ellis said, "and I’m proud that they did."

This article originally appeared on Santa Rosa Press Gazette: Federal tax bill almost included elimination of adoption tax credit