Adoption Tax CreditAdoption tax credit - it's the government's way of lending a helping hand for your adoption expenses. If you qualify, it could help cover up to $12,150 of your adoption expenses.
How it WorksLet's say you are paid every two weeks and have about $210 in federal taxes automatically deducted from your paycheck. During the course of the year, you finalized an adoption and brought your child home. The adoption cost you $19,000 in expenses, including international and agency fees, travel, lodging and document fees.
When you file your taxes, you would normally owe $12,012 in taxes. Because you've had $10,920 deducted from your biweekly paychecks, you still owe $1,092. But, this year you are able to take an adoption tax credit of up to $12,150 of what you owe - in your case, $12,012. Not only do you not owe that $1,092, but the government will pay you the entire $10,920 that was deducted over the year for federal taxes.
If you have taken out any loans to pay for your adoption, the tax credit is a great way to pay off those loans and become debt free.
A Five Year BenefitBetter still, the adoption tax credit can be spread out over five years. Let's say you typically owe about $6,000 in taxes per year, and your adoption expenses came to a total of $23,000. You can take a tax credit of $6,000 the first three years, and deduct the remaining $5,000 from the taxes you owe the fourth year.
Who QualifiesFor 2009, you cannot take the credit if your modified adjusted gross income was $222,180 or more. If your adjusted gross income was under $182,180, you could take the full tax credit. If your income was between $182,180 and $222,180, the tax credit you can take is gradually phased out.
What Expenses Qualify?According to the IRS website, expenses that qualify include adoption fees that are "reasonable and necessary," court costs, attorney fees, traveling expenses, meals and lodging during that adoption trip and "other expenses directly related to and for which the principal purpose is the legal adoption of an eligible child."
Other Helpful SourcesAsk many couples why they don't adopt, and they'll say finances are what are holding them back. But it doesn't have to be that way. My husband and I had a limited income, yet we were able to adopt three children, including one child from Guatemala without going into debt. You can too. Here's how.
Are you thinking about pursuing an international adoption? Developing a plan for how you'll pay for that adoption is the first step you should take. Here are some ways to get started.
There are many ways to fund an international adoption. Learn different ways by clicking here.
Uncle Sam also wants to help you with your adoption costs through a tax credit. Learn more.
If you're looking for more details about the tax credit, you can read more by clicking here.
Grants are a great way to help with adoption costs. Find agencies that offer grants by clicking here.
Want to learn about more places for grants? Here are some more great places to apply.
It is possible to find an international adoption you can afford. Here are some ideas to help save money.
Still wondering how you're going to pay those adoption expenses? Find more ways to raise funds by clicking here.
A garage sale is a great way to raise adoption funds. Learn how to finance your adoption by clicking here.
Intimidated by high adoption costs? Don't be. Paying for your adoption involves taking one step at a time. Find some more tips by clicking here.
So how much will your international adoption cost? The answer will depend on the country you choose and whether you choose to go through an agency or pursue an independent international adoption. Learn more here.
Fundraisers are a great way to pay for your adoption. Learn about some fun ones by clicking here.
The best kinds of fundraisers are fun, fairly simple to organize and - naturally - bring in the most funds for your international adoption. Learn more.
Making and selling gift baskets are one creative way to raise funds for your international adoption. You can read some tips on making an appealing basket by clicking here.
Thinking about taking out a loan to pay for your adoption? Read this article first by clicking here.
If you want to pursue a loan using your home as equity, there are important things to know upfront. Learn more here.
One of the easiest and most effective ways to pay for your international adoption is to learn to cut back on costs. Here are some easy ways.
Do you love doughnuts? You're not alone. Help pay for that adoption with a doughnut fundraiser. Learn more here.
When making plans for raising funds for your adoption, don't forget to include friends and family. Learn how to write a letter to solicit funds and help by clicking here.
More and more companies are now offering adoption benefits, so it's definitely worth your while to check and see if your company offers such benefits. Learn more.
Great Fundraisers!Use a raffle to raise funds for your adoption. Learn more.
Sell t-shirts and pay for your adoption with a t-shirt fundraiser. Read more.
Read one person's story about raising funds for her adoption with a Garage sale fundraiser.
A benefit gala is a fun way to pay for your adoption. Read more.
How about a chicken dinner for raising funds. You can read all about it by clicking here.
One adoptive parent used a roller skating fundraiser to help with adoption costs. You can read her story by clicking here.
While you're doing one fundraiser, why not combine it with another one? Learn how.
Looking for a low-cost, simple way to raise funds? How about the pasta fundraiser? Read more.
A taste test party is another great way to raise funds. Learn more about it by clicking here.
Using the cash bash to raise funds for your adoption. Learn more.
A jigsaw puzzle fundraiser is a fun way to raise money for your adoption. You can read about it by clicking here.
Pay Adoption Costs
Adopt Debt free will provide you with the tools and techniques to completely pay for your adoption and bring your child home without having to go into debt!
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