Yesterday, I am talking about Exclusion for employer-provided adoption benefits. Actually, you also can get adoption credit. In 2010, the adoption credit turns to be refundable, meaning that you may be able to claim it even if you owe no tax. Most of requirements are the same as Adoption assistance, such as who, when issues, etc.
You should also fill out Form 8839, then fill out Form 1040 line 71.
But be aware that you cannot claim both a credit and exclusion for the same expenses.
If any of the following statements are true, you can claim this credit:
1. You paid qualified adoption expenses in 2009 but adoption was not final in 2009; or in 2010 and adoption became final in or before 2010.
2. Adopt with a special needs and the adoption became final in 2010, even you did not pay any qualified adoption expenses.
3. paid qualified adoption expenses for a foreign child in 2010 or before and adoption became final in 2010; or 2010 and the adoption became final before 2010.
4. a carryforward of an adoption credit from a prior year.
What's qualified adoption expenses:
It includes:
- Adoption fees,
- Attorney fees,
- Court costs,
- Travel expenses while away from home,
- Re-adoption expenses relating to the adoption of a foreign child.
It do not include:
- You received funds under any state, local, or federal program,
- That violate state or federal law,
- For carrying out a surrogate parenting arrangement,
- For adoption of your spouse's child
- Get reimbursed
- As credit or deduction under other provision of income tax law
PSQ
Source: http://www.irs.gov
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