Monday, November 26, 2012

Dive off Fiscal Cliff to Affect Orphans & Children in Foster Care

Dive off fiscal cliff could be 'disastrous' for orphans, foster children, say advocates

As talk of tax increases and deep cuts to government programs dominate Washington, adoption advocates are warning of another crisis should the adoption tax credit be allowed to expire at the end of the year — a potentially “disastrous” outcome for more than 400,000 children in the U.S. foster care system.
Among the so-called Bush tax cuts set to expire at the end of 2012 is a one-time adoption tax credit that gave $12,650 this year to families who took in a parentless child. But unless Congress acts to extend it, the only tax credit for adoptive parents on Jan. 1, 2013, will be to those who take in special needs children from within the United States. For them, the credit will be just $6,000.
“And it’s really not going to do much,” said Chuck Johnson, president and CEO of the National Council For Adoption. “Most families adopting those kids won’t even qualify for it because of the strict income requirements. It really would be a credit unclaimed at that point and that could have pretty disastrous impact for kids awaiting adoption in foster care.”
Adoptive families already suffered a blow in the current year, when the credit stopped being refundable — payable even to families with little or no tax liability — and became merely a deduction.
Roughly 423,000 children are living in the United States without permanent families, according to the Congressional Coalition on Adoption Institute, and 115,000 of them are eligible for adoption. But nearly 40 percent of those children wait longer than three years in foster care prior to being adopted.

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