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Washington, D.C. - Today, U.S. Senators Bob Casey (D-PA) and Roy Blunt (R-MO) announced that they have re-introduced the Adoption Tax Credit Refundability Act to make the current adoption tax credit fully refundable. Making the tax credit fully refundable will ensure that more families can benefit from this critical support.

“It is a common misconception that only wealthy families adopt,” said Senator Casey. “We must do all we can do to ensure that all children are afforded the opportunity to grow up in a permanent, loving home. This legislation is a commonsense approach to improve lower-income families’ ability to adopt and support children from foster care.”

“Millions of children in our country and around the world are waiting for the safe, stable home and loving family that every child deserves,” Senator Blunt said. “Making the Adoption Tax Credit permanent was an important step to encourage more families to adopt. Restoring the refundability portion of the credit will build on that progress by making adoption more affordable for hardworking families. I’m encouraged by the bipartisan support we’ve received for this bill, and I’ll continue advancing policies that make it easier to connect children in need of homes with families that are eager to adopt.”

The adoption tax credit was made permanent in the American Taxpayer Relief Act in January 2013. However, that law did not extend the refundability provisions that applied to the adoption tax credit in 2010 and 2011. The Adoption Tax Credit Refundability Act will restore the refundable portion of this critical support for families wishing to adopt.

According to the Department of Health and Human Services, one-third of all adopted children live in families with annual household income at or below 200 percent of the poverty level. Despite the common misperception that only wealthy families adopt, nearly 46 percent of families adopting from foster care are at or below 200 percent of the federal poverty level. Many of these families’ tax burdens are so low that they cannot benefit from the adoption tax credit at all unless it is refundable.

Data from 2011 indicate that nearly 62 percent of families who filed for the adoption tax credit benefited from refundability. Forty-one percent of families who benefited from refundability (25 percent of all families who took the tax credit) had AGIs under $50,000.

These data indicate that a refundable adoption tax credit plays a significant role in lower-income families’ ability to adopt and support a child from foster care. Older data from a 2006 study cited by HHS demonstrate a significant financial benefit to society, as well: the cost of adoption and permanency is significantly lower than the cost to federal, state and local governments to provide long-term foster care.


This legislation has been endorsed by the Adoption Tax Credit Working Group Executive Committee and 116 national, state and local groups.


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  1. Children & Families