Financial Resources for Adoption

The Real Cost of Adoption

While the costs can be prohibitive, there are ways for families to find financial relief. “Going into debt is never something somebody wants to do,” says Gumm. “I know people who’ve drained retirement accounts to pay for adoption.” Parents who don’t have the money for a private adoption should consider adopting from the foster care system. However, it is rare that an infant would be available. But “because we’re so eager to get kids out of foster care as quickly as possible and into permanent homes, there’s really not very much in the way of expenses,” says Hochman. In foster care adoptions, fees are often kept to a minimum or are waived, such as the charge for the home study. There are also adoption subsidies of up to several hundred dollars per month (depending on the state) available to help defray costs for families who adopt from the foster care system. If you’re still set on a private agency adoption, some agencies charge fees on a sliding scale, so people with less income pay less.

Here are other funding sources to consider:

Federal and State Tax Credits: There is a federal tax credit of up to $12,650 per adoption in 2012. The amount a family qualifies for depends on such factors as the family’s income, qualifying expenses such as court costs and attorney’s fees, and whether the child has special medical needs. However, the adoption tax credit is set to expire on Dec. 31, unless Congress passes legislation to extend it. Some states also offer tax credits.

Military Family Subsidies: Members of the military whose adoptions are arranged through qualifying adoption agencies may be eligible for reimbursement for up to $2,000 per child or up to $5,000 per year.

Employer Reimbursement Programs: Many companies offer financial assistance for adoption as a benefit. An Aon Hewitt survey of 1,000 major U.S. employers found that 56% offer a financial adoption benefit. Company payments ranged from $500 to $25,000 according to the Dave Thomas Foundation for Adoption.

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