Legislative and Policy Updates
Federal Adoption Tax Credit, 2011 Forms On IRS Website
The IRS has released the 2011 form needed to claim the Federal Adoption Tax Credit, Form 8839. The IRS has also updated the instructions that accompany form 8839. Notably, the IRS has created a table (pg. 4 of the instructions) detailing what documentation is needed when filing for the credit, based on the type of the adoption. The IRS is also committed to updating the website regularly with future developments on the credit. Click here to visit the IRS website.
Help raise awareness about the availability of the adoption tax credit. Click here to download VFA's Adoption Tax Credit Postcard to share with eligible parents who may benefit from this credit.
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President Obama Signs Child Welfare Act (H.R. 2883)
As the Executive Director of Voice for Adoption, I was both honored and proud to stand with fellow foster youth alumnus and child welfare advocates, Representatives Geoff Davis (R-KY) and Karen Bass (D-CA), the Administration for Children and Families Secretary George Sheldon and Commissioner Bryan Samuels while President Barack Obama signed the, bipartisan-bicameral, Child and Family Services Improvement and Innovation Act (H.R. 2883/Public Law 112-34) into law. Members of Congress acted quickly to introduce and pass H.R. 2883; the bill was introduced on September 12th, 2011, it passed in both chambers of Congress by September 22nd and President Obama signed the bill on September 30th. The champions of the bill are House Human Resources Subcommittee Chairman Geoff Davis (R-KY) and Ranking Member Lloyd Doggett (D-TX) and Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Orrin Hatch (R-UT). The bill reauthorizes the Promoting Safe and Stable Families (PSSF, Title IV-B part 2 of the Social Security Act) and Child Welfare Services (CWS, Title IV-B part 1) programs through Fiscal-Year 2016 and extends Title IV-E State waiver authority (demonstration projects that encourage innovation in child service delivery). Voice for Adoption supports this legislation and thanks the President and Members of Congress for making this bill a priority.
Click here to read VFA’s article on the bill, which includes a summary of the bill’s provisions.
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Child Welfare Legislation Passes the U.S. House and Senate
September 23, 2011: This week Congress passed the bipartisan/bicameral Child and Family Services Improvement and Innovation Act (H.R.2883). The bill worked its way through both the House Subcommittee on Human Resources and the Senate Finance committee (committees with jusrisdiction over child welfare issues). The U.S. House of Representatives voted and passed the bill on Wednesday, September 21st (395/25) and the Senate voted and passed the bill by unanimous consent the following day. The legislation will reauthorize the Promoting Safe and Stable Families and Child Welfare Services programs; it will also reauthorize the Department of Health and Human Services (HHS) to grant states to use federal foster care funds to test innovative, new child welfare programs through the use of Title IV-E waivers. The bill is expected to be signed by the President shortly.
Voice for Adoption supports this legislation and thanks members of Congress for acting expeditiously to pass this bill.
Voice for Adoption's letter of support was recognized by the Chairman of the Human Resources Subcommittee, Congressman Geoff Davis (R-KY), in his floor statement, click here read the Chairman's remarks.
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Senate Finance Committee Chairman Max Baucus (D-MT), Ranking Member Orrin Hatch (R-UT), House Ways and Means Subcommittee on Human Resources Chairman Geoff Davis (R-KY) and Ranking Member Lloyd Doggett (D-TX) introduced legislation to extend and improve two child welfare programs that provide assistance to children and families. The Child and Family Services Improvement and Innovation Act (S.1542/H.R. 2883) is a bipartisan/bicameral bill that extends and improves the Child Welfare Services and the Promoting Safe and Stable Families (PSSF) programs through Fiscal-Year 2016. If Congress does not act to reauthorize these programs they will expire on Sept. 30th 2011 and we could lose most of the $700 million these programs provide.
Learn how you can advocate, click here to read VFA's action alert.
Click here to read the announcement of the bill and click here to read a summary of the bill.
Click here to read VFA's letter of support.
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Voice for Adoption joined a group of nearly 80 organizations who signed on a letter addressed to the Leaders of the House Ways and Means Committee, in support of the Every Child Deserves a Family Act (H.R. 1681). The ECDF Act is a federal bill that would open up more homes to children in foster care by restricting federal funding for states employing discriminatory practices in adoption and foster care placements based on sexual orientation, gender identity, or marital status or the sexual orientation or gender identity of the foster youth involved. The letter urged the committee to take action to advance the legislation.
Click here to the read the letter. Click here to learn more about ECDF legislation.
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On Thursday, June 16th, the House Ways and Means Subcommittee on Human Resources held a hearing on improving programs designed to protect youth at risk of abuse and neglect. Specifically the hearing focused on the reauthorization of Promoting Safe and Stables Families and the Stephanie Tubbs Jones Child Welfare Services programs, which are set to expire at the end of fiscal year 2011.
Click here to learn more about the hearing, including access to testimony from witnesses and guidelines for submitting written comments (due June 30th, 2011). Voice for Adoption submitted testimony to the Subcommittee, to access our written comments click here.
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NEW: Exciting news! The IRS has provided clarification regarding documentation for claiming the Federal Adoption Tax Credit for special needs adoptions. The Internal Revenue Service has posted official language that indicates that Adoption Assistance or Subsidy Agreements are acceptable documentation of special needs. The IRS website now lists the following FAQ’s:
Q.11 What documentation will the IRS require you to provide to support your claim for the adoption credit on your return?
A.IRS requires different documents if the adoption is foreign or domestic, final or not final, and if the adoption is of a child with special needs.
Q.13What audit documentation is necessary for special needs adoptions?
A.If you are claiming the credit for a finalized special needs final adoption, you must submit the final adoption order or decree, and the state’s determination of the child’s special needs. You are not required to prove you paid any expenses in connection with the adoption.
You will need to send in a state court adoption certificate, order, judgment, or final decree showing the names of the adoptive child and parent and signed by a representative of the state court under seal. Also include documentation from the state establishing that the child has been determined to have special needs. . Acceptable documentation of the state’s determination of special needs includes (but is not limited to) any of the following:
- An adoption assistance or subsidy agreement issued by the state or county
- Certification from the state or county child welfare agency verifying that the child is approved to receive adoption assistance
- Certification from the state or county child welfare agency verifying that the child has special needs
For more information click here.
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The Federal Adoption Tax Credit was made refundable for the first time! The Patient Protection and Affordable Care Act (Public Law 111-148) made significant, short term, changes to the adoption tax credit. The credit per-child is now $13,170 for adoptions finalized in 2010. It also made the tax credit refundable. Meaning you can claim it for a refund even if you owe no taxes. Families who adopt a child with special needs from foster care can claim the credit without needing to incur or document expenses. Now that the credit is refundable many more families will benefit; even families who adopted earlier than 2010, but didn’t have enough tax liability to access the credit in previous years. Families that finalized adoptions in 2005-2009 can carry forward unused tax credit to their 2010 return and claim it as a refundable credit. Click here to download VFA's adoption tax credit post-card , which includes helpful links to the IRS website where you can access the form and instructions for claiming the credit.
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Voice for Adoption is calling on members of Congress to make the adoption tax credit work better to promote adoptions of waiting foster children and support families who adopt children with special needs from foster care. The attached position paper lays out VFA's key principles for extending the adoption tax credit. As described in the paper, VFA believes that any extension of the adoption tax credit should ensure that the credit:
- Is effective at promoting and supporting adoptions of waiting children in foster care
- Is beneficial for families who adopt children with special needs from foster care
- Accounts for the fact that many of the expenses associated with adopting from foster care show up after the adoption is finalized
The adoption tax credit has a high price tag for the federal government (approximately $355 million in 2005), yet only a small percentage of this money supports adoptions from foster care. With 123,000 children in foster care waiting for their forever family, the tax credit should be restructured to make it more effective at achieving one of its core goals of promoting adoption for waiting foster children.
Click here to download VFA's position paper on the adoption tax credit.
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Great news for older youth in foster care! The Fostering Adoption to Further Student Achievement Act (FAFSA) became law as an amendment to the College Cost Reduction and Access Act (Public Law 110-84). The FAFSA provision will make it possible for teens in foster care to be adopted without losing access to college financial aid. Under this new law, youth who are adopted from foster care at any point after their 13th birthday will not have to include their parents' income in the calculations for determining their need for financial aid; such a youth will be considered an "independent student" for the purpose of determining their financial need.
The FAFSA provision will take effect in July 2009, to apply for the 2009-2010 school year. The provision will apply to youth even if they were adopted before the new law was passed. Voice for Adoption worked closely with Senator Norm Coleman's (R-MN) and Senator Mary Landrieu's (D-LA) offices on this important legislation.
To download VFA's factsheet on the college financial aid provisions for former foster youth, click here.
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Voice for Adoption tracks proposed federal child welfare legislation in Congress. Click here to download the current chart of bills related to child welfare that have been introduced in Congress.
