Legal Blog

Adoption Tax Credit Restored After Backlash

Adoption application near toy on light wooden table background top view copyspaceA tax credit for adoptive families that was initially removed from the GOP tax bill as part of its massive tax overhaul has been restored after backlash from individuals and organizations spanning the ideological spectrum. Both sides of the political aisle agree that caring for kids and creating healthy families helps strengthen our communities.

The Adoption Tax Credit allows adoptive parents to take a credit of up to $13,570 of qualified expenses paid towards their adoption. The original version of the Tax Bill offered as part of a massive tax overhaul by the GOB eliminated the Adoption Tax Credit based on arguments that it was costly and only benefits wealthier families who adopted since the credit is only available to people who itemize their deductions. This argument was rejected, and this myth dispelled.

First, the tax credit phases out and is eventually eliminated after a family’s adjusted gross income exceeds defined levels. Second, the Adoption Tax Credit has shown to be a major factor enabling families of all backgrounds to step forward and adoption. But most importantly, the Adoption Tax Credit benefits children and society. The purpose of the Adoption Tax Credit is to enable and empower families of all backgrounds to step forward to adopt children who lack parental care. The Adoption Tax Credit benefits children and communities by keeping children out of foster care.

There are more than 100,000 children in foster, and approximately 25,0000 minors age out of foster care every year. Despite well-intended systems throughout the state and federal system, foster care has dire yet preventable consequences for children. Studies have shown that security, confidence, and healthy physical and mental development depends on strong, permanent attachments that occur in early childhood and continue into adulthood. The devastating insecurity results when a child grows into adulthood with no emotional safety net has severe consequences for youth who age out of care. Studies show that 20% become homeless after age 18; only 50% being employed upon reaching age 24; less than 3% will earn a college degree; 71% of female youth aging out of foster care pregnant by age 21; and 25% diagnosed with post-traumatic stress disorder (twice the rate of United States war veterans). Many of these young people wind up in prison or otherwise repeat the cycle of violence and helplessness experienced in their earlier lives.

The Joint Committee on Taxation asserted that the Adoption Tax Credit will cost taxpayers nearly $4 billion over ten years. Yet, this figure fails to account for the financial costs on society by the failure of these young people to secure an education, employment and stability, a cost which is staggering and easily dwarfs the stated cost of the tax benefit. See “The Human, Social, And Economic Cost of Aging Out of Foster Care,” an article written by Wayne Winston Sharp, PH.D. for the Adoption Advocate, Issue 83, a publication of the National Council for Adoption (May 2015).

The Adoption Tax Credit was retained in the tax bill because it makes economic and practical sense. Children who grow, develop and learn in safe, stable and secure environments with the protection of families ultimately create functional and thriving societies as adults.

Do you have any questions regarding your eligibility to adopt or how the adoption tax credit may benefit you? Contact Deborah E. Spivack today at or 267.338.1321. Working with an adoption attorney can help you develop a legally secure adoption plan and determine the risks and costs involved. We offer services in Philadelphia, Delaware, and New Jersey regions.


Professional Headshot of Attorney Deborah SpivackDeborah E. Spivack is a principal attorney in the firm’s Family Law practice group based in Southern Jersey. Deborah’s practice focuses exclusively on adoption and family planning in Pennsylvania, New Jersey, and Delaware. Deborah has extensive experience representing Adopting Parents, Birth Parents, Agencies, and Children (upon appointment by a court) in a broad range of adoption matters, including those which are private/independent, agency, identified, stepparent, second parent, guardian, legal custodian adoptions, or adoptions by individuals standing in loco parentis to the child, as well as adoptions of foreign-born children present in the United States. Many of these adoption cases have complex legal issues such as interstate placements, adoption subsidy, non-participating or contesting parties, international parties, immigration problems, Indian Child Welfare Act implications, state child protective services, and special needs or older children. The hallmark of Deborah’s practice is providing personalized, practical, and informative legal advice that enables clients to make informed decisions about family planning while considering their short and long-term goals.