Adopting a child can be expensive. Fortunately, there may be tax benefits to help adoptive parents defray some of the costs. For 2023, a credit of up to $15,950 ($16,810 for 2024) is available for qualified expenses, with phaseouts for higher-income parents. The credit is nonrefundable, which means it’s limited to your tax liability. But you generally can carry the unused amount forward for up to five years. Qualified expenses include adoption fees, legal costs and travel expenses. In addition, if your employer provides adoption assistance, you may be able to exclude that amount from income. State laws and other rules may limit or enhance tax benefits.
Our Blog 