Carlos Barria | Reuters
President Donald Trump holds sample tax forms as he promotes a newly unveiled Republican tax plan with House Republican leaders in the Cabinet Room of the White House in Washington, November 2, 2017.
As House Republicans mark up their tax overhaul, the Tax Cuts and Jobs Act, adoptive families are pushing back on their decision to do away with a critical tax credit.
The $1.5 trillion tax bill eliminates a slate of credits and deductions, including the exclusion for adoption assistance programs at work.
Under current tax law, families can claim a credit of up to $13,570 per child to cover qualified adoption expenses, including court costs and attorney fees, traveling expenses and adoption fees. Your credit is limited to your tax liability for that year, and you can carry it forward for up to five years.
Credits like this one reduce your taxes on a dollar-for-dollar basis. They’re more valuable than deductions, which lower your taxable income based on your tax bracket.
This benefit begins to phase out for taxpayers with a modified adjusted gross income of $203,540.
Meanwhile, workers who are receiving adoption benefits from their employers can exclude up to $13,570 of assistance per child.
Some 63,960 taxpayers filed Form 8839 to claim the adoption credit in 2015, according to the IRS.
It remains to be seen whether the provision remains — and whether the Senate will keep it in its version of the tax bill — but some adoptive families are speaking out on what the credit means to them.