Real Life Situations
Question: We intend to adopt a child in 2010. Does it affect our income tax return?
Answer:
Yes. Thousands of dollars of expenses incurred in connection with adopting a child can be recouped via a tax credit, so it pays to keep careful records. In 2010, the credit can be as high as $12,170. If you adopt a child with special needs, you get the maximum credit even if you spend less.
Feel free to contact me if you or someone you know has this type of situation. Tax laws can be tricky; thus, the above answer cannot be applied to all circumstances because the slightest variation could cause a different outcome.
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