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The GOP Tax Bill, the Elimination of the Adoption Tax Credit, and the Implications

Adoption Tax CreditLast week, House Republicans unveiled the “Tax Cuts and Jobs Act,” a 429-page overhaul to the country’s current tax code. One of the casualties in the current bill is the one-time Federal Adoption Tax Credit – $13,570 per child – which has been on the books for 20 years. Eliminating this credit is projected to save about $3.8 billion over 10 years, according to the nonpartisan Joint Committee on Taxation, but both conservative and liberal groups are challenging lawmakers to look at the bigger picture.

“You’re talking about $380 million a year, so this is something I feel like doesn’t break the bank, says Rep. Mark Walker (R-N.C.), head of the conservative Republican Study Committee, “but it is something that literally impacts these families that don’t make a lot of money but still want to open their home for children,”

According to Adoptive Families magazine, between 2015 and 2016, domestic newborn adoptions cost an average of $37,000 and international adoptions averaged about $42,000. Adoptions from the U.S. foster care system average about $2,600. Many families rely on the tax credit to make the process not just affordable, but possible.

“Financial incentives do make a difference in people’s decisions on whether to adopt,” says Adam Pertman, president and founder of the National Center on Adoption and Permanency. “Not that they do it for the money, but it’s expensive and it makes a difference and helps people get to yes.”

As the GOP bill currently stands, starting in 2018, families that finalize adoptions would no longer have access to the tax credit. In 2015 alone, nearly 64,000 families benefited from the credit to some degree.

The credit exists for families who may not be able to afford adoption otherwise.

“More than 60 percent of adopted children in the U.S. are adopted by middle- and lower-income taxpayers,” says Jim Daly, president of Focus on Family. “Almost one-half of children adopted from foster care live in families with household incomes under $75,000. Eliminating [the tax credit] is unacceptable. We can do better as a nation.”

How the Adoption Tax Credit Benefits Extend Beyond Adoptive Parents

“If you have a child naturally and in the hospital, you have health insurance to cover the bills,” says Kendra Taylor, who is currently in the process of adopting four children from foster care. “Nothing covers the legal fees for adoption. You’re on the hook for it.”

However, the benefits of the adoption tax credit extend beyond eliminating a portion of the financial burden associated with adoption.

The Federal Government

Believe it or not, the adoption tax credit actually saves the federal government money. According to a 2006 study by the Children’s Bureau, “approximately $65,422 to $126,825 is saved for every child who is adopted rather than placed in long-term foster care.”

The issue of a family getting a tax credit, however, “is much broader than dollars and cents,” says Schylar Baber, executive director of Voice for Adoption. “It’s about a child and the life of a child.”

The Child

Many experts believe the elimination of the adoption tax credit will dissuade many middle- to low-income families from pursuing adoption, placing a greater burden on an already overloaded foster care system. Currently, there are about 112,000 children awaiting adoption in the foster care system.

“There are children who have no families. What’s more important than that?” says Mary Boo, executive director of the North American Council on Adoptable Children. “We’ve talked to thousands of families who could not have adopted without that credit. We know it’s important.”

Furthermore, children who age out of the system – those children who reach the age of 18 without being adopted – face an uphill struggle. According to National Council for Adoption, these young adults are less likely to be positive contributors to society.

  • Less than 50 percent are employed
  • 25 percent don’t receive a high school diploma or GED
  • Just six percent graduate from college
  • 40 percent spend time homeless
  • Roughly 50 percent have substance abuse problems
  • 60 percent of young men who age out have been convicted of a crime

Same-Sex Couples

“You’ve got a growing number of LGBTQ individuals who are now increasingly pursuing adoption,” says Chuck Johnson, president and CEO of the National Council for Adoption.

According to a report by the Williams Institute in 2013, same-sex couples are four times more likely to adopt a child than different sex couples – 13 percent of same-sex couples have an adopted child compared to three percent of opposite-sex couples. As of four years ago, more than 16,000 same-sex couples were raising about 22,000 adopted children in the U.S.

The elimination of the adoption tax credit will “have a disproportionate impact on same sex couples,” says Ed Harris, chief communications officer for Family Equality Council.


The professionals at Adoption Makes Family have many years of experience in adoption services, helping couples and singles explore their options for creating or growing their family. We are a non-profit (501-C3) licensed adoption agency based in Maryland.

If you have any questions, you can contact us by phone at 410-683-2100, by e-mail at or use our online contact form.

Adoption Makes Family was founded to meet the needs of birth parents and adoptive parents in a manner that is sensitive, compassionate, and personal.


  1. Berenson, Tessa . Gay Rights and Pro-Life Groups Oppose Republican Tax Plan. Time, 6 Nov. 2017,
  2. Ravitz, Jessica, and Kathryn Vasel. “Adoption tax credit: What the GOP tax bill means to parents and kids.” CNN, Cable News Network, 7 Nov. 2017,
  3. Weixel, Nathaniel. “Push to restore adoption credit gains steam.” TheHill, 8 Nov. 2017,
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