Act Now to Save The Adoption Tax Credit Before It’s Gone
November is Adoption Awareness Month and politics seems to be on everyone’s mind. What better time then to offer your support to Help Save the Adoption Tax Credit.
Currently the tax credit amount is $12,650, but it will sunset at the end of this year. If no action is taken by Congress, the credit will revert back to $6,000 and apply only to the limited number of special needs adoptions that have adoption expenses. No credit will remain for most adoptions!
By Napp Nazworth , Christian Post Reporter
The adoption child tax credit is one of the many parts of the U.S. tax code that could change dramatically on Jan. 1, 2013, if Congress and President Barack Obama do not act. Adoption advocates worry the changes would make adopting a child more difficult for middle income families.
During the President George W. Bush administration the adoption tax credit was increased from $6,000 to $12,650 and made refundable (meaning that even families who do not pay taxes can receive the credit.) This was part of a larger package of changes to the tax code, including rate cuts, that were set to expire in 2010. In March 2010, the Affordable Care Act, or “Obamacare,” extended the expanded adoption tax credit through 2011. In December 2010, Congress and Obama agreed to a two-year extension of all the Bush tax code changes, so they are now set to expire at the end of 2012.
Congress is currently meeting in a “lame duck” session and these changes, part of the so-called fiscal cliff, will be a large part of the agenda.
If no changes are made, the adoption tax credit will return to $6,000 and non-refundable. Families would receive no help through the tax code with the costs of adoption if the credit returns to being non-refundable.
The adoption tax credit was also made “flat” for special needs adoptions to encourage the adoption of children in foster care. This means that families who adopt children who qualify as special needs can claim the full credit without having to claim qualified expenses.
For full story, go to The Christian Post