Fortunately, along with expenses, there are also programs that help ease the financial burden. When you qualify, these programs can greatly defray the costs of adopting along with easing the costs of raising your child. How you structure your finances at the end of the year can go a long way when it comes to ensuring that you take full advantage of the programs that are available to you. Here’s what you should know about end of the year adoption-related expenses:
What are the costs associated with adoption?
The first thing to do when it comes to structuring your end of the year finances for your adoption is to appreciate all of the costs that are associated with adoption. Some expenses are the same in every adoption case. In other cases, the cost of adoption depends on the type of adoption that you pursue. In any event, having a realistic look at the costs involved can help you plan to set enough aside for your adoption.
Families of all types adopt. You don’t have to be rich to adopt. It’s just important to appreciate the financial commitment that’s involved with adoption so that you can do the best possible job structuring your household finances to prepare for the expenses.
The courts charge a fee in order to process your adoption case. Filing fees are standard in all adoption cases. They’re a fixed cost. Although there may be other court-related expenses like witness fees if your case goes to a hearing, the filing costs for an adoption are the same in all cases.
Home study costs and agency fees
Whether you work with an agency to complete your home study or you find qualified individuals on your own, one of the biggest expenses related to any adoption is the home study. Home studies are expensive because they require multiple visits to the home and detailed reporting. A home study can cost more than $1,000 and may even cost up to $3,000 in some cases.
Infant adoption – biological mother’s attorney and living expenses
If you adopt an infant, it’s customary to pay the mother’s living expenses. There are strict rules about what you can and can’t help the biological mother with financially. In addition to living expenses, it’s also customary to pay for her attorney fees.
Travel for out of state and international adoptions
Out of state and international adoptions require significant travel. You’re going to have a wait in your child’s home location for approval to move the child across state and international lines. In an international adoption, you also need government documents and approvals in order to take your child home.
The costs of care for your child
Finally, there are financial costs associated with raising a child. All children have financial needs. Your child may have costs of daily living as well as extraordinary expenses like special medical needs or counseling needs.
How to afford an adoption: Financial help for adoption
Even though there are significant expenses associated with adoption, there are also significant financial resources that are available in many cases. These assistance programs are both federal and state-based. There are also private resources that may help you. What programs you qualify for depend on the type of adoption. Here are some of the programs that you might qualify to use to fund your adoption:
Tax credits for adoption
The U.S. federal government has a generous tax credit program for adopting families. The program allows families to deduct most of the costs of their adoption from their federal taxes. When you’re structuring your end of the year finances, it’s important to remember that you can carry over this tax credit from year to year. If you don’t use the entire tax credit in one year, you can use it in later years. It’s important to structure your taxes in a way that you take full advantage of the tax credit. Things like travel and court costs can all offer lucrative tax credits if you structure things right.
Adoption tax credits aren’t available to everyone. If you adopt your spouse’s child, the adoption tax credits don’t apply. In most other cases, nearly all of your adoption expenses can be structured as tax credits that are spread out over multiple years to offer you maximum benefit.
In addition to federal subsidies, there are also state subsidies that can help you with the cost of adoption. If your child is considered a high risk to find an adoptive family based on age, special needs or race, you might qualify to receive monthly cash payments that remain in effect until your child reaches the age of 18. As you look at your finances at the end of the year, it’s important to remember that your subsidies don’t go into effect until the adoption is complete. You must also apply to take advantage of the subsidies. If you qualify and complete the application process, these monthly subsidies can go a long way to helping you have a sound financial footing for your family. Be sure to remember that your child may also qualify for state medical insurance for their entire childhood.
Reimbursement for foster care adoptions
If you adopt from foster care, the State of North Carolina may help you directly with some of the costs associated with the adoption. They might directly reimburse you for things like your filings fees and the costs of your home study. Be sure to keep records of your expenses. The reimbursement is significant; if you qualify, direct reimbursements may be up to $2,000.
Fundraising for adoption
Remember that friends, family and your employer may be eager to help you find the funds for adoption. Your support network may be eager to help you organize fundraisers for a worthy cause. Employers often have generous adoption assistance programs, too. Don’t forget to explore private resources as you organize your financial plan for adoption.
Costs and financial support for adoption
The end of the year is a great time to think about your adoption-related finances. Although adoption is expensive, there are financial programs that are available to help you. Examining your finances can help you begin the new year with a sound adoption plan that works for your finances and for your family.