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Hello, we are going to be signing on with a private agency and signing up for the foster/adopt program through the state. Our question is, if we adopt through the state and only spend money on an attorney and travel costs plus the state reimbursing us up to $1500 at finalization can we still use the tax credit or do you have to spend $10,000 on an adoption to use it?
You can always file to get back whatever it is that you paid out for eligible adoption expenses.
Ex: If you spend $1 on an adoption, you can use the adoption tax credit forms to get a maximum of $1 of your tax money back. If you spend $10,000 on an adoption, you can use the adoption tax credit forms to get a maxium of $10,000 of your tax money back.
I don't think you're interested in special needs children, but IF the child you adopt is designated "special needs" and was legally a foster child at any point, then regardless of the amount you spend on the adoption (even if you just spend $1) you qualify to get up to the total amount of the credit (something like $10,160) of your tax money back. It's an incentive for people to adopt special needs children.
So, if the child is not special needs, just keep every single one of your receipts - gas money, meals, lodging, filing fees, copying fees - absolutely everything that the IRS says is an eligible expense. If you spend any amount of money that you don't get refunded, you can apply for that amount of your tax dollars back.
Hope that helps!
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DianeS- can you tell me where you found this?
"IF the child you adopt is designated "special needs" and was legally a foster child at any point, then regardless of the amount you spend on the adoption (even if you just spend $1) you qualify to get up to the total amount of the credit (something like $10,160) of your tax money back. It's an incentive for people to adopt special needs children."
We have adopted 3 SN but don't have any out of pocket expenses since the Co. paid lawyer, etc. I am wondering if we will get this?
Thank you!:confused: