Deadline looming for renewal of adoption tax credit

Deadline looming for renewal of adoption tax credit
EVERETT, Wash. -- A significant deadline is looming for families waiting to adopt a child. The adoption tax credit, which can be worth up to $12,650, depending on a family's tax burden for 2012, is set to expire.

Sophie and David Pham of Everett were counting on that credit when they started the adoption process. They are waiting to be matched with a child, likely a boy, from Ethiopia.

Now more than a year into it, they have a room decorated and ready.

"I'm extremely happy for some reason when I come in here," David said of the bedroom. "Someday this bed will be filled, and if he has a friend or a brother, both of them can share a room."

But before they open their hearts and their home, they have to open their wallet.

"There's two trips to Ethiopia involved with the program so the total amount will be about $30,000," Sophie said.

They hope to offset those costs with the adoption tax credit. It can help hopeful parents who adopt out of foster care, through private adoptions in the U.S. or from orphanages around the world.

Julie Snyder knows the benefit of the tax credit, both as an adoptive mother, and by working at the Renton-based adoption agency World Association of Children and Parents, or WACAP. She regularly fields calls from families with the desire - if not the money - to adopt.

"Being able to tell them about this tax credit and let them know it's something that will help them offset the costs in the long run, is something that's able to be the make or break moment for people in deciding whether to pursue adoption or not," she said.

The Pham's are invested, financially and emotionally. The only piece missing is their child.

"We're in it for the long run," David said.

"We've made up our mind that either way, we're adopting," Sophie agreed. "So we'll go through the process. But we're really hoping we'll have that help of the tax credit."

House Bill 4373 is a bipartisan bill that would renew the adoption tax credit, but Congress won't take it up until after November's election.

And advocates are concerned the credit won't be made refundable.

When a tax credit is refundable, the benefit to the taxpayer can go over what they pay in federal income tax, meaning adoptive parents could get some money back to cover additional expenses.

For more information on the effort to extend the tax credit, visit www.adoptiontaxcredit.org