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WAYS TO
FINANCE AN ADOPTION AND
INFORMATION ON FEDERAL AND STATE TAX CREDITS |
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1. Most of the costs of an adoption will be returned
to you through federal tax credits.
Yes it is true. Effective January, 2002 there is a
$10,000 per child credit that you can receive for
adoption expenses. You should get Publication 968 ?
Tax Benefits for Adoption, which can also be
downloaded online: www.irs.ustreas.gov or CHI will
send you a copy.
Related Website:
www.AdoptionTaxCredit.com - Information and support
on the adoption tax credit.
2. Many States offer extensive tax credits ?up
to $10,000.
To find out about your state tax credits, try the
web using the address: http://www.state.yourstate.us
Contact your state Division of Family Services and
State Tax Office to ask about your state’s tax
credits for adoption or to find out if you qualify
for any special state subsidy programs. A Checklist
on Title IV-E Adoption Assistance and State Adoption
Subsidies for Adoptive Parents
3. Corporate Matching Gifts.
There are many corporations that have adoption
assistance programs (AAPs). Click on 'resources' on
the header above. Check with your employer’s human
resource department to see if they have an AAP or
other adoption assistance benefits. On the web,
check out http://adopting.org/employer.html ,
http://www.adoptionbenefits.com/ or http://abanet.org/family/advocate/sp97tax.html
for very important details.
4. Military, Nonrecurring Program.
There is a one-time subsidy program available for
full-time military personnel. Currently adoption
couples or singles can receive up to $2000 per child
or $5000 maximum for siblings.
Many military personnel do not know this is
available to them.
Military families are entitled to adoption benefits
of up to $2,000 a year for reasonable and necessary
expenses associated with adoptions finalized after
October 1, 1990, whether they are infant adoptions,
intercountry adoptions, or adoptions of children
with special needs. The benefits cover the
following:
Public and private adoption fees charged by an
agency in a foreign country;
Placement fees, including fees charged to adoptive
families for counseling;
Legal fees, including court costs, in connection
with services that are unavailable to military
personnel through their legal assistance office;
Medical and hospital expenses of a newborn; and
Medical expenses incurred by a birthmother.
Benefits are paid after an adoption is finalized,
and apply to both singles and couples.
http://www.militaryadoption.com/
5. Nonrecurring Federal Adoption Program
This is a one-time federal adoption program,
administered by the states, and includes
foreign-born children adopted by U.S. Citizens.
State Reimbursement A reimbursement for
non-recurring adoption expenses (agency fees, legal
costs, and transportation) is available through each
State for families who adopt children with special
needs (children from minority cultures). Half of the
expenses are paid through State funds, the other
half through federal funds up to $2,000. The benefit
differs by State depending on the cost of the
adoption, State rules, and public awareness.
Reimbursement for Non-Recurring Expenses
6. Dependency Exemption - Tax Savings
Click here to check out: Dependency Exemption
7. Loans and Second Mortgages.
Refinance your house/Home equity loan - If you own
your house (part of it, anyway :-) you may be
eligible for a home equity loan, or you may be able
to refinance your mortgage. This is typically the
lowest-rate loan at a bank. Quite often, the
interest is tax-deductible! Also, most banks offer a
home equity line-of-credit. You will be given a
checkbook you can use to pay expenses as they arise.
The check you write will be added to your current
loan balance. Ask your bank for details. Rates are
usually low and interest tax exempt. If you like you
might try: Laura@amcmort.com
Borrow from your 401-k - Many 401-k plans now offer
loans from your retirement savings.
This is usually a very-low interest rate. Many
people are able to fund their entire adoption
from this one loan. Talk to your employer to see if
this is an option for you.
Other Sources for Adoption Loans or Grants: http://www.chinacare.org/adoptions.html
Watch this space for information on other loans
Children's Hope can help you to work out!
Or e-mail: Melody@ChildrensHopeint.org
8. Dependency Exemption on Taxes
9. Suggestions from the National Endowment For
Financial Education
Visit the site: www.nefe.org for detailed
information.
10. Look at the top of this page and click on
resources.
11. For excellent overall information!! go to:
http://www.adoptionfinancing.com/
Click here for a copy of
China Adoption Guide |
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