The two major financial benefits available to adoptive parents are federal tax credits and adoption subsidies. A federal tax credit is a reduction of your federal income tax in the year in which you adopt a child. The conditions for claiming this credit are complicated depending on many factors such as the year of the adoption, whether or not the child has special needs, and how much you spent on adoption expenses. Adoptive parents who did not take the federal tax credit may be able to go back as far as 2003 to benefit from the credit. For the years 2010 and 2011 the tax credit became refundable, meaning that you will get the amount of the credit back regardless of how much you paid in income taxes. For detailed current information on the federal tax credit, go to www.nacac.org. Adoptive parents are wise to explore this issue on their own since many tax preparers seldom or never deal with this issue and may be unfamiliar with the complicated conditions. An adoption subsidy is assistance provided for children with special needs as an incentive to help get children adopted. It may include ongoing financial aid, medical coverage, or other services such as respite care or therapy. Adoption subsidies should be negotiated prior to the finalization of an adoption. Adoptive parents need to familiarize themselves with these terms and with the whole issue of adoption subsidy. Case managers may give you their own opinion as to whether you qualify for adoption subsidies, but they do not have the final word. The judge at the final adoption hearing does.
The adoption process can be long and complicated. It follows state and federal laws, as well as other regulations. There are mountains of paperwork for legal procedures, not to mention the many other practical aspects required to complete a successful adoption. These things add up, and they leave families searching for adoption financial assistance.
There has to be help out there, right? Even for the many families considering adoption who are in stable financial situations, few have the needed funds immediately available. If you’re searching for financial help for adoption, there’s good news. There are a variety of ways to receive financial aid for adoption, and this guide will help you find one that works for you. For prospective birth mothers looking for information on financial help when placing a child for adoption, you can complete this online form to connect with us today.
Why Many Families Need Help with Adoption Costs
Depending on how much research you’ve already done about adoption, you may still be left wondering why the cost can be so high in the first place. Many people are surprised when they learn for the first time that private adoption costs tens of thousands of dollars or more. It’s no wonder most families search for adoption financial assistance. Adoption is not a transaction where a family pays for a baby. Rather, the costs are incurred due to the administrative, legal, medical and other practical needs of the adoption process. While it’s fair to see some of the costs as unfortunate, they are necessary to complete safe and legal adoptions.
To complete an adoption, there are many professionals involved:
• Adoption specialists
• Social workers
• Medical professionals
• State-level administrators
Typically, the cost of adoption is made up of the funds necessary for all these professionals to do what’s necessary to complete an adoption. The other portion of adoption costs incurred by adoptive families is variable adoption costs, which are primarily made up of prospective birth mother expenses. The total cost of adoption is not paid out at one time. However, it is common to make large payments during the process, and it is recommended that you have a budget set and a plan to pay for all adoption expenses from the beginning. Since most families don’t have tens of thousands of dollars lying around, it’s common to ask: “Do you get financial help when you adopt a child?”
Unfortunately, there is no way to guarantee financial help for adoptive parents. This is why the adoption specialists at American Adoptions advise families to do everything possible to budget for the total cost of adoption. No one should assume that financial assistance for adoption costs will be given to them. There are, however, opportunities to find financial aid for adoptive parents that are worth looking into.
Financial Help for Adoption
So, where can a family find adoption financial aid to help with adoption fees? There are plenty of options.
Depending on your financial situation, and how far into the adoption process you are, some forms of adoption financial assistance will be available, while others may not. It’s always a good idea to consult a financial planner about any of these choices along with your own research if you are able to do so. One of the most popular forms of financial assistance for adoption costs is adoption grants. Grants are typically awarded by a nonprofit organization, and families do not have to pay them back. An adoption grant is, essentially, a gift. The appeal is obvious. This type of financial support for adoptive parents does come with some challenges you have to apply for each grant, you may not be awarded grants you’re counting on bit the potential benefits far outweigh any frustrations.
A counterpart to adoption grants is adoption loans. Adoption loans are like standard personal loans. They typically come from a financial institution, have a set payment plan and include interest. Some adoption loans are better than others. Taking out any loan brings some level of financial risk, and many financial planners would advise that a loan be a last-resort form of adoption financial aid. However, many families have found adoption loans to be helpful.
Other adoptive families have found help with the cost of adoption through fundraising. Adoption fundraising is an opportunity to be creative and get your whole community involved in your adoption journey. If you already have other children, it’s also the perfect opportunity for them to contribute to the adoption. There are so many fundraising ideas to try.
Special Needs Adoption Assistance
Parents adopting children with special needs may be eligible for federal and state adoption assistance. This financial support (also referred to as an adoption subsidy) is usually paid monthly and is intended to help with medical needs and other support-related expenses.
Federal adoption assistance funds are available through the states of the Social Security Act. The definition of “special needs” has three criteria:
1. The child can’t or shouldn’t be returned to his or her birth parents,
2. The child has a factor (or combination of factors) that make them more difficult to place for adoption (i.e. age, sibling group status, medical condition, emotional disabilities, etc.), and
3. There has been a reasonable (but unsuccessful) effort made by the state to place the child without providing assistance.
The state or tribe determines if a child fits the criteria of special needs.
Eligibility for Special Needs Adoption Assistance
If the child meets the above criteria to be considered a “special needs” orphan, the next step is to determine if they are eligible to receive special needs adoption assistance. Some of the ways to be eligible for special needs adoption assistance include:
• The child was removed from their home by a judge’s ruling. The judge’s decision was based on a finding that removal was in the child’s best interest and that the home was contrary to the child’s welfare.
• The child has been in foster care for at least 60 consecutive months. (Special needs adoption assistance may also cover siblings who are eligible to be adopted with their sibling.)
• The child meets the requirements for Supplemental Security Income (SSI) benefits through the Social Security Administration.
• The child had previously been adopted but that adoption was dissolved (that may have occurred upon a parent’s death, for example).
• An infant born to a foster child who is receiving Title IV-E assistance will also be covered by Title IV-E assistance and meets the definition of “special needs.”
Special Needs Adoption Assistance Benefits
The types of expenses covered, the frequency of payment, and the exact benefits provided by adoption assistance depend on state policies. They are determined on a case-by-case basis. Special needs adoption assistance may include the following:
• Monthly payments up to the amount that family foster care would have provided
• Medicaid coverage (this is automatic for eligible children)
• Reimbursement of nonrecurring adoption expenses (up to $2,000 federally, but many states set lower limits)
• Post-adoption services for special needs children, including in-home support and referrals to community services
What are the Benefits of Adoption for Children?
1. Increased Opportunities
Many birth mothers who choose adoption have an unplanned pregnancy and thus feel they aren’t prepared to have a baby yet. On the other hand, adoptive parents have been planning for a long time to have children. As a result, these families may be more financially and emotionally prepared to care for a child. In fact, 79% of adoptive parents who do private domestic adoption have had education beyond high school. When parents have higher education, they are often more likely to support their children in school. On average, 74% of children in domestic private adoptions are engaged in school.
2. Safe Homes and Neighborhoods
Before they can adopt, all adoptive families must undergo a home study. A home study is a process that ensures the adopting family has a safe, stable home for a child. If you choose to adopt, rest assured knowing that your baby will be in a safe environment! On average, 79% of all adopted children live in safe neighborhoods, 96% live in neighborhoods with amenities, and 75% live in neighborhoods with no characteristics of poor physical condition.
3. Healthy Living
The majority of adopted children live very healthy lives. In fact, 85% of children have a health status that is “excellent” or “very good” and only 7% of adopted children missed more than ten days of school due to illness or injury, according to Adoption USA. Additionally, 88% of children in domestic private adoption consistently have health insurance.
4. Positive Social and Emotional Feelings
So most adopted children live in healthy, safe, and stable environments. But what about their happiness? Do adopted children experience positive feelings and good social behaviors?
Studies show they do! In fact, 91% of children in private domestic adoptions exhibit positive social behaviors and only 9% of adopted children have been diagnosed with depression.
5. Attention from Parents
The benefits of adoption don’t stop there. Adopted children often get more attention from their parents. According to a national survey, 73% of adopted children between the ages of 0 and 5 are sung to or told stories to every day. To compare, only 59% of non-adopted children were sung to or told stories daily. Additionally, studies show that over half of all adopted children eat dinner with their families six or seven days per week. When parents and children regularly share meals together, it connects families, positively influences adolescents’ nutrition habits, and can positively impact children’s’ behavior.
6. Feelings of Belonging and Love
Many people believe that adopted children grow up with feelings of abandonment. However, studies show that 90% of adopted children have positive feelings about their adoption. Adopted children are not “left behind” or “given up”. They are loved and chosen. Birth mothers simply want to give their baby the best life possible and adoptive families want to share their love with a beautiful son or daughter. In open and semi-open adoptions, the birth mother can keep in touch with her baby and the adoptive family. In an open adoption, the birth mother can even keep in personal contact with her baby, including visits and phone calls. In this case, your baby will never have to wonder who their birth mother is and where they came from.
7. Birth Mothers Can Personally Make Sure Their Baby is placed with the Perfect Family!
To conclude, the last benefit of adoption is that as a birth mother choosing adoption, you can choose the adoptive family for your baby. Do you want your baby to grow up in a great neighborhood? Do you want their parents to have a college education? Would you like your little one to grow up with siblings? You can choose a family that meets your requirements, allowing your little one to have the life you want him/her to have.
Additionally, if you want to, you can meet the adoptive family. Your baby can have all the benefits listed above when you choose the perfect family.
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