Adoption Credit
The Adoption Credit is a tax credit offered to individuals who incur qualified expenses related to the adoption of a child. This credit is designed to help offset the costs associated with adopting a child, including adoption fees, court costs, and legal expenses.
The credit is non-refundable, meaning it can reduce a taxpayer’s tax liability to zero but will not generate a refund. As of the tax year 2023, the maximum credit amount is subject to annual adjustments for inflation and is available to adoptive parents with eligible expenses incurred during the adoption process.
For example, if a taxpayer has $15,000 in qualified adoption expenses and their tax liability is $10,000, they can use the Adoption Credit to reduce their tax bill to zero but would not receive a refund for the remaining $5,000 of the credit.
« Back to Glossary Index