One of the casualties of the fiscal cliff deal that affects us is the elimination of the Adoption Tax Credit, In 2012, the maximum credit was $12,650 and the credit was not refundable. In 2005, we took advantage of the Adoption Tax Credit. We expected to get the Adoption Tax Credit again, except the second adoption has taken six years and still counting. We also knew that the Adoption Tax Credit was likely to expire sometime.
At this point, we are continuing with the adoption, since the tax credit was not a factor in our decision. However, if the credit is reinstated, we'll gladly take advantage of it.
Correction: As Mark Smith points out in a comment below, the Adoption Tax Credit is extended permanently as a non-refundable tax credit of $12,970 for taxpayers below the phaseout AGI income of $194,580 to $234,580. Although non-refundable, the unused credit can be carried forward for 6 years.
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3 comments:
Sad to hear that they got rid of this tax cut. Hopefully their won't be anymore casualties in the budget showdowns.
This is incorrect. The American Taxpayer Relief Act has permanently extended the Adoption tax credit and employer assistance. For 2013 the credit is $12,970. So it is still available for you unless your income is above the phaseout limit.
@Mark,
Thanks for the correction. I don't know how I missed the extension given when I posted the article.
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