When a family first talks to me about their concerns with adoption, I am quick to give them all the resources I have to make adoption more affordable. There are a lot of different angles to finding the funds to pay for adoption, and each avenue will add up when you pursue them concurrently. Here are some tips to make adoption more affordable.
1. Low-risk path
The first and best thing you can do to keep adoption expenses locked down is to choose the lowest risk path possible. It can be tempting to choose a path that is more affordable with less legality involved, but when you do it can lead to more problems, heartache and costs down the road. This is where adoption consultants and other long-standing professionals can help. When you have someone guiding you through the process, she will help you choose not only the safest adoption path — but also a more affordable one.
2. Adoption tax credit
The adoption tax credit is an excellent way to help offset the costs of adoption. When you are looking at adoption, you definitely want to reach out to your tax professional to get the latest regulations and information on this tax credit. As of January 2015, here are the facts:
- The tax credit is more valuable than a deduction because it is a direct write-off.
- Since it is not refundable, it will be a reduction on your taxes owed and it can carry for up to five years.
- Currently, the maximum adoption credit is $13,400 per child or adoption attempt and is also available for adoptions that were unsuccessful prior to the end of the tax year.
- The adoption credit you receive is based on your adjusted gross income. If your modified adjusted gross income is $201,010 or less, you quality for the entire credit. However, if it is $241,010 or more, you do not qualify.
- If you adopt a child with special needs in the United States, you will be able to claim the full tax credit, regardless of whether or not you had qualified adoption expenses.
This can get pretty complicated, so work with a professional to make sure you get the maximum benefit.
3. Employer adoption reimbursement
Many employers offer adoption reimbursement for some of your expenses. If you plan on approaching your employer about this, you can use the very helpful free resources and adoption kit supplied by the Dave Thomas Foundation for Adoption. When it comes to taxes, employer-paid adoption assistance of up to $13,400 per child will be tax-free depending on your adjusted gross income. Receiving the tax credit does not diminish what you can receive from your employer — and vice versa. These are two sources of funding that can add up for you; you just can’t claim the same expenses under more than one program.
4. Loans and grants
Another way many families pay for adoption is by taking out loans or receiving grants. There are many foundations and funds that offer financial support to families pursuing adoption. One that some of my clients have had the most success with recently is America’s Christian Credit Union. It’s also worth checking out Resources for Adoption as they keep an up-to-date database of loans and grant options.
Fundraising can be a very profitable way to finance your adoption! I recently had a couple, Heidi and Brandon from California, who threw an auction that included:
- 28 live items including plane rides, quilts, a beach house vacation, firewood and babysitting
- 85 silent items including jewelry, baked goods, gift cards and gift baskets
- A dessert auction
- During the event, they also sold a BBQ dinner and raffle tickets
Their efforts were extremely successful as they raised $18,000 after accounting for their costs! There are many things you can do to raise funds, including building a website, using a fundraising platform like GoFundMe or hosting a raffle.
Remember not to rule out adoption because of costs. When you want to build a family, you shouldn’t let anything stand in your way. There are so many things you can do to lessen the cost of adoption with a little ingenuity.
Nicole Witt is the owner of The Adoption Consultancy, an unbiased resource serving pre-adoptive families by providing them with the education, information and guidance they need to safely adopt a newborn, usually within three to 12 months. She is also the creator of Beyond Infertility, a community support site and online magazine geared towards families who have gone through infertility. You can visit that website at Beyond Infertility.