(Posted 2020 March; Updated 2026 January)
Tax Deductions for Foster and Adoptive Parents
Did you know that adoptive parents and foster parents may be eligible for some tax credits for the children in their homes? The Department of Family Services offers some general tax information for your awareness. We hope that you find it helpful, but since we do not employ tax experts, this information should not be solely relied upon for income tax preparation decisions.
Check out some highlights courtesy of the team at Families Rising (Formerly North American Council on Adoptable Children).
Adoption Tax Credit 2025 Highlights
- The maximum credit for adoptions finalized in 2025 is $17,280 per child.
- The 2025 credit is partially refundable — up to $5,000 may be refunded even without tax liability.
- Refundability applies only to new credit claimed for 2025 — not to carry forward from 2020–2024.
- Families must have a modified adjusted gross income below $259,190 to claim the full credit.
- Special needs adoptions are eligible for the full credit, regardless of actual expenses.
- International adoptions must be finalized in 2025 to claim the credit.
- In 2025 families can use $5000 as refundable AND the rest can be offset with tax liability, any carryforward into 2026 will only offset tax liability.
- To claim the credit, taxpayers will file IRS Form 8839 with their 2025 tax return.
For more information on topics such as claiming a child in foster care on your taxes, qualifying adoption expenses, qualifying a special needs child, the partially refundable adoption tax credit, and eligibility for the adoption credit, email Families Rising or check out these resources:
- Adoption Tax Credit | Families Rising
- Adoption Tax Credit 2025 - Families Rising
- Adoption Credit | Internal Revenue Service
- Dependents | Internal Revenue Service
- Qualifying child rules | Internal Revenue Service
If you have specific questions regarding the preparation of your income tax return, please contact the IRS or 800-829-1040. You can also discuss the matter with a tax preparation expert.
This article posting is part of the Foster Family News monthly newsletter designed to keep foster parents informed about all the new and notable happenings in Fairfax County.
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