Video: Tax Breaks for Adopted Children
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Video Transcript: Tax Breaks for Adopted Children
Hi. I’m Chun Wong. A CPA and partner at Safe Harbor LLP, a tax and audit firm based in San Francisco, California. Today’s topic is tax breaks for adopting children. Tax payers who adopt a child are eligible for a credit. The amount of the credit is directly related to how much money is spent for adoption costs. The 2012 adoption credit is a maximum of $12,650.00, subject to certain phase out at income levels. However this provision will be expiring and in 2013 the amounts will be $5000.00 or $6000.00 for a special needs child. To be eligible you must adopt first an eligible child and number 2 you must be paying these expenses out of pocket. An eligible child is any child under the age of 17 or younger. A special needs child is a child of any age but has to be a U.S. citizen or a resident alien. Qualified adoption expenses are calculated by adding up all your adoption related expenses less any reimbursements you get from your employer, a government agency, or another organization. Eligible expenses include adoption fees, attorney costs, court costs. The credit finally can be taken in the year the adoption is finalized. To fully understand the adoption credit please consult your local tax professional or by emailing firstname.lastname@example.org
Video Target: Parents Who Have Adopted Children or Are Thinking of Adoption
This video explains the in’s and out’s of tax strategies for parents who are thinking of adopting, or have already adopted a child.