A Few Things To Keep In Mind This Tax Weekend
It’s coming. We all feel it. Once the year changes, you feel like you have a world of time, and then before you know it, it’s April 15th, Tax Day.
One important thing to remember this ominous weekend is to apply for your Adoption Tax Credit if you finalized your adoption in 2018.
Here are a few technical details about the tax credit:
- The maximum credit for 2018 will be $13,840 per child.
- The credit will begin to phase out for taxpayers with modified adjusted gross income in excess of $207,580 and will be completely phased out for taxpayers with modified adjusted gross income of $247,580 and above.
Of course, there will be an adjustment in numbers for 2019. More information on the tax credit is available at www.irs.gov.
Another thing to keep an eye out for are changes to the tax laws that may impact the Child Tax Credit.
As a result of tax law changes made in the 2017 tax reform law (known as the “Tax Cuts and Jobs Act,” P.L. 115-97), adoptive parents who have not finalized their adoption, or have recently finalized and not yet received their child’s social security number, may have problems claiming the Child Tax Credit.
It appears that under the changes only a social security number (SSN) is acceptable for claiming the Child Tax Credit and an Adoption Taxpayer Identification Number (ATIN), generally used by adoptive parents, may not be accepted. Additionally, the SSN must be issued before the due date of the tax filing (April 15th or October 15th in the case of an extension), which may preclude adoptive parents from filing an amended return once the SSN is received.
This is an issue adoptive parents should discuss with their accountant or tax specialist. A tax professional will be the best person to field the ins an outs of this issue.
Hopefully this information helps as we go into the tax weekend. Good Luck!